Economic Indicators | Jobs and Unemployment

Missing Workers: The Missing Part of the Unemployment Story


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Updated January 9, 2015

In a complex economy, conventional measures sometimes fall short.

In today’s labor market, the unemployment rate drastically understates the weakness of job opportunities. This is due to the existence of a large pool of “missing workers”—potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. In other words, these are people who would be either working or looking for work if job opportunities were significantly stronger. Because jobless workers are only counted as unemployed if they are actively seeking work, these “missing workers” are not reflected in the unemployment rate.

As part of its ongoing effort to create the metrics needed to assess how well the economy is working for America’s broad middle class, EPI is introducing its “missing worker” estimates, which will be updated on this page on the first Friday of every month immediately after the Bureau of Labor Statistics releases its jobs numbers. The “missing worker” estimates provide policymakers with a key gauge of the health of the labor market.

Current “missing worker” estimates at a glance

Updated January 9, 2015, based on most current data available

  • Total missing workers, December 2014: 6,100,000
  • Unemployment rate if missing workers were looking for work: 9.1%
  • Official unemployment rate: 5.6%

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Millions of potential workers sidelined: Missing workers,* January 2006–December 2014

Date Missing workers
2006-01-01 530,000
2006-02-01 110,000
2006-03-01 110,000
2006-04-01 250,000
2006-05-01 210,000
2006-06-01 110,000
2006-07-01 60,000
2006-08-01 -120,000
2006-09-01 120,000
2006-10-01 -50,000
2006-11-01 -220,000
2006-12-01 -500,000
2007-01-01 -460,000
2007-02-01 -210,000
2007-03-01 -150,000
2007-04-01 650,000
2007-05-01 560,000
2007-06-01 360,000
2007-07-01 370,000
2007-08-01 840,000
2007-09-01 410,000
2007-10-01 800,000
2007-11-01 280,000
2007-12-01 250,000
2008-01-01 -320,000
2008-02-01 220,000
2008-03-01 50,000
2008-04-01 340,000
2008-05-01 -60,000
2008-06-01 20,000
2008-07-01 -70,000
2008-08-01 -90,000
2008-09-01 180,000
2008-10-01 60,000
2008-11-01 420,000
2008-12-01 420,000
2009-01-01 710,000
2009-02-01 620,000
2009-03-01 1,050,000
2009-04-01 750,000
2009-05-01 650,000
2009-06-01 650,000
2009-07-01 1,040,000
2009-08-01 1,320,000
2009-09-01 2,050,000
2009-10-01 2,270,000
2009-11-01 2,300,000
2009-12-01 3,120,000
2010-01-01 2,770,000
2010-02-01 2,690,000
2010-03-01 2,440,000
2010-04-01 1,940,000
2010-05-01 2,530,000
2010-06-01 2,950,000
2010-07-01 3,220,000
2010-08-01 2,830,000
2010-09-01 3,200,000
2010-10-01 3,640,000
2010-11-01 3,310,000
2010-12-01 3,800,000
2011-01-01 3,910,000
2011-02-01 4,110,000
2011-03-01 3,960,000
2011-04-01 4,000,000
2011-05-01 4,110,000
2011-06-01 4,220,000
2011-07-01 4,640,000
2011-08-01 4,100,000
2011-09-01 3,990,000
2011-10-01 4,090,000
2011-11-01 4,090,000
2011-12-01 4,150,000
2012-01-01 4,450,000
2012-02-01 4,180,000
2012-03-01 4,240,000
2012-04-01 4,630,000
2012-05-01 4,240,000
2012-06-01 4,060,000
2012-07-01 4,520,000
2012-08-01 4,630,000
2012-09-01 4,500,000
2012-10-01 3,930,000
2012-11-01 4,370,000
2012-12-01 4,070,000
2013-01-01 4,350,000
2013-02-01 4,790,000
2013-03-01 5,310,000
2013-04-01 5,060,000
2013-05-01 4,840,000
2013-06-01 4,700,000
2013-07-01 5,030,000
2013-08-01 5,150,000
2013-09-01 5,370,000
2013-10-01 6,120,000
2013-11-01 5,700,000
2013-12-01 5,950,000
2014-01-01 5,850,000
2014-02-01 5,650,000
2014-03-01 5,330,000
2014-04-01 6,210,000
2014-05-01 5,940,000
2014-06-01 5,950,000
2014-07-01 5,810,000
2014-08-01 5,890,000
2014-09-01 6,250,000
2014-10-01 5,720,000
2014-11-01 5,760,000
2014-12-01 6,100,000

 

* Potential workers who, due to weak job opportunities, are neither employed nor actively seeking work

Note: Volatility in the number of missing workers in 2006–2008, including cases of negative numbers of missing workers, is simply the result of month-to-month variability in the sample. The Great Recession–induced pool of missing workers began to form and grow starting in late 2008.

Source: EPI analysis of Mitra Toossi, “Labor Force Projections to 2016: More Workers in Their Golden Years,” Bureau of Labor Statistics Monthly Labor Review, November 2007; and Current Population Survey public data series

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Missing Workers
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The unemployment rate is vastly understating weakness in today’s labor market: Unemployment rate, actual and if missing workers* were looking for work, January 2006–December 2014

Date Actual If missing workers were looking for work
2006-01-01 4.7% 5.0%
2006-02-01 4.8% 4.8%
2006-03-01 4.7% 4.8%
2006-04-01 4.7% 4.9%
2006-05-01 4.6% 4.8%
2006-06-01 4.6% 4.7%
2006-07-01 4.7% 4.8%
2006-08-01 4.7% 4.6%
2006-09-01 4.5% 4.6%
2006-10-01 4.4% 4.4%
2006-11-01 4.5% 4.4%
2006-12-01 4.4% 4.1%
2007-01-01 4.6% 4.4%
2007-02-01 4.5% 4.4%
2007-03-01 4.4% 4.3%
2007-04-01 4.5% 4.9%
2007-05-01 4.4% 4.8%
2007-06-01 4.6% 4.8%
2007-07-01 4.7% 4.9%
2007-08-01 4.6% 5.1%
2007-09-01 4.7% 4.9%
2007-10-01 4.7% 5.2%
2007-11-01 4.7% 4.9%
2007-12-01 5.0% 5.1%
2008-01-01 5.0% 4.8%
2008-02-01 4.9% 5.0%
2008-03-01 5.1% 5.1%
2008-04-01 5.0% 5.2%
2008-05-01 5.4% 5.4%
2008-06-01 5.6% 5.6%
2008-07-01 5.8% 5.7%
2008-08-01 6.1% 6.0%
2008-09-01 6.1% 6.3%
2008-10-01 6.5% 6.5%
2008-11-01 6.8% 7.1%
2008-12-01 7.3% 7.5%
2009-01-01 7.8% 8.2%
2009-02-01 8.3% 8.7%
2009-03-01 8.7% 9.3%
2009-04-01 9.0% 9.4%
2009-05-01 9.4% 9.7%
2009-06-01 9.5% 9.9%
2009-07-01 9.5% 10.1%
2009-08-01 9.6% 10.4%
2009-09-01 9.8% 10.9%
2009-10-01 10.0% 11.3%
2009-11-01 9.9% 11.2%
2009-12-01 9.9% 11.7%
2010-01-01 9.8% 11.4%
2010-02-01 9.8% 11.4%
2010-03-01 9.9% 11.3%
2010-04-01 9.9% 11.0%
2010-05-01 9.6% 11.1%
2010-06-01 9.4% 11.1%
2010-07-01 9.4% 11.3%
2010-08-01 9.5% 11.1%
2010-09-01 9.5% 11.3%
2010-10-01 9.4% 11.5%
2010-11-01 9.8% 11.7%
2010-12-01 9.3% 11.5%
2011-01-01 9.2% 11.4%
2011-02-01 9.0% 11.4%
2011-03-01 9.0% 11.2%
2011-04-01 9.1% 11.4%
2011-05-01 9.0% 11.4%
2011-06-01 9.1% 11.5%
2011-07-01 9.0% 11.6%
2011-08-01 9.0% 11.3%
2011-09-01 9.0% 11.3%
2011-10-01 8.8% 11.2%
2011-11-01 8.6% 11.0%
2011-12-01 8.5% 10.9%
2012-01-01 8.3% 10.9%
2012-02-01 8.3% 10.7%
2012-03-01 8.2% 10.7%
2012-04-01 8.2% 10.8%
2012-05-01 8.2% 10.6%
2012-06-01 8.2% 10.5%
2012-07-01 8.2% 10.8%
2012-08-01 8.0% 10.7%
2012-09-01 7.8% 10.4%
2012-10-01 7.8% 10.1%
2012-11-01 7.7% 10.3%
2012-12-01 7.9% 10.2%
2013-01-01 8.0% 10.5%
2013-02-01 7.7% 10.5%
2013-03-01 7.5% 10.6%
2013-04-01 7.6% 10.5%
2013-05-01 7.5% 10.3%
2013-06-01 7.5% 10.2%
2013-07-01 7.3% 10.2%
2013-08-01 7.2% 10.2%
2013-09-01 7.2% 10.3%
2013-10-01 7.2% 10.8%
2013-11-01 7.0% 10.3%
2013-12-01 6.7% 10.1%
2014-01-01 6.6% 10.0%
2014-02-01 6.7% 9.9%
2014-03-01 6.6% 9.7%
2014-04-01 6.2% 9.8%
2014-05-01 6.3% 9.7%
2014-06-01 6.1% 9.5%
2014-07-01 6.2% 9.6%
2014-08-01 6.1% 9.5%
2014-09-01 5.9% 9.6%
2014-10-01 5.7% 9.1%
2014-11-01 5.8% 9.1%
2014-12-01 5.6% 9.1%

 

* Potential workers who, due to weak job opportunities, are neither employed nor actively seeking work

Source: EPI analysis of Mitra Toossi, “Labor Force Projections to 2016: More Workers in Their Golden Years,” Bureau of Labor Statistics Monthly Labor Review, November 2007; and Current Population Survey public data series

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Roughly half of missing workers are of prime working age: Missing workers,* by age and gender, December 2014

Gender/age group Missing workers
Men under 25 630,000
Men 55+ 610,000
Men 25–54 1,840,000
Women 25–54 1,380,000
Women 55+ 1,250,000
Women under 25 390,000

 

* Potential workers who, due to weak job opportunities, are neither employed nor actively seeking work

Source: EPI analysis of Mitra Toossi, “Labor Force Projections to 2016: More Workers in Their Golden Years,” Bureau of Labor Statistics Monthly Labor Review, November 2007; and Current Population Survey public data series

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Methodology

How do we estimate the number of missing workers?

Labor force participation rate projections published by the Bureau of Labor Statistics in November 2007—before the start of the Great Recession—are available in Table 3 of Mitra Toossi, “Labor Force Projections to 2016: More Workers in Their Golden Years,” Bureau of Labor Statistics Monthly Labor Review, November 2007. The projections assumed a healthy labor market over the period in question, 2006–2016, so the projected participation rate changes reflect purely non-cyclical factors (e.g., the impact of retiring baby boomers). The difference between these projections and the actual labor force participation rate is thus a good measure of the cyclical change in the labor force participation rate, i.e., the change that is a direct result of the weak labor market in the Great Recession and its aftermath. It does not count, for example, those retiring baby boomers who would have left the labor force whether or not the Great Recession happened.

Based on this logic, missing workers are estimated in the following way: The labor force participation rate projections for 2016 by gender and age group (age groups 16–19, 20–24, 25–34, 35–44, 45–54, 55–64, 65–74, 75+) available in Table 3 of Toossi (2007) are assumed to be structural rates. The current month’s structural rates (by gender and age group) are calculated by linearly interpolating between 2006 and 2016. The size of the potential labor force is calculated by multiplying the current month’s structural rates by actual population numbers (available by gender and age group from the Current Population Survey public data series). The difference between the size of the potential labor force and size of the actual labor force (also available by gender and age group from the Current Population Survey public data series) is the number of missing workers.


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