Nearly a quarter of Americans are “functionally unemployed” according to a new report from the Ludwig Institute for Shared Economic Prosperity. That’s a slight increase over LISEP’s function unemployment estimate for May.
In regular reports, the institute measures what it calls the “True Rate of Unemployment” – a percentage of the U.S. labor force without full time jobs of at least 35 hours per week but want them, who do not have jobs at all or who do not earn a living wage of at least $25,000 annually before taxes. This group is referred to by LISEP as “functionally unemployed.”
“The percentage of American workers unable to secure full-time, above-poverty-wage jobs continues to tick upward,” it said in its latest report.
While the “functionally unemployed” rate was 24.3%, the U.S. Bureau of Labor Statistics official unemployment rate was much lower at 4.2%. LISEP’s estimate has been above 24% since this February.
“Across demographics, the functional employment prospects were somewhat mixed in May. Men, Black, and Hispanic workers saw improvements relative to April, while women and White workers experienced an increase in functional unemployment,” said LISEP.
This Thursday, the institute revealed that Madison, Wisc., was ranked as the top city in the nation for functional employment. Its status has been driven by “robust job growth, higher wages, and the ability to secure desired hours,” to fuel a functional unemployment rate of around 16% said LISEP. At the other end of the spectrum was McAllen, Texas with a functional unemployment rate over 45%.
“The TRU by MSA analysis is vital for understanding regional economic distinctions,” said LISEP Chairman Gene Ludwig. “It provides an unvarnished look at the realities for low- and middle-income families across localities, moving beyond anecdotal impressions to highlight exactly where regions are thriving or struggling.”
While LISEP’s fictional unemployment estimates continue to rise, other concerning data regarding unemployment was released earlier this month. Audacy reported in early June that filings for U.S. unemployment benefits rose to their highest level in eight months.