Economics Labor Washington State Politics

Could WA State actually have the fifth highest unemployment in the nation?

As it turns out, the short answer is “yes.” The longer answer is, it all depends on the way you measure the rate. There are a three ways to look at the unemployment rate:

  • The official rate, which is referred to in official Bureau of Labor Statistics (BLS) as “U.3.” U.3 only counts unemployed workers who have sought work within the last four weeks. If its longer than four weeks but less than one year before, they are classified as discouraged workers, and outside the U.3.
  • A more honest measure is”U.6″, which adds together the above U.3 workers to those who are working part-time because they can’t find a full-time job. As in almost anyone who works for an hourly wage in temp work, retail, restaurants, coffee shops and bars. This was how unemployment rates were calculated until 1992.
  • The most accurate rate is compiled by John Williams at his Shadow Government Statistics website, often referred to as “ShadowStats.” This takes the U.6 data and adjusts it for “SGS-estimated long-term discouraged workers, who were defined out of official existence in 1994.”

The chart below illustrates the difference:

Unemployment rate: Official versus ShadowStats alternate

But even if you simply use the Government’s U.6 statistics, Washington still comes in at 5th highest. Here’s the list:

  1. Nevada: 19.6%
  2. California: 18.8%
  3. Oregon: 17.2%
  4. Rhode Island: 16.7%
  5. Washington: 16.4%

So now you’re thinking, how could that be? Boeing, even with recent layoffs is a big employer, Microsoft continues to import techs, and Amazon is building new buildings just to put all their new workers in, so what’s going on?

Actually, it’s not much of a mystery. Just get outside the Puget Sound region, over to the Southwest or Northeastern parts our state and it becomes obvious. Here are the insufficient U.3 numbers for selected counties in Washington State from the ESD.

Low Unemployment Counties % Rate High Unemployment Counties % Rate
King 4.4 Grays Harbor 12.1
Snohomish 4.9 Ferry 11.9
Whitman 5.3 Lewis 11.1
San Juan 6.0 Pend Oreille 11.0
Asotin 6.2 Stevens 11.0
Walla Walla 6.4 Wahkiakum 11.0
Kitsap 6.8 Pacific 10.5
Whatcom 6.9 Skamania 10.4
Thurston 7.0 Columbia 10.1

 

And here’s a handy map, from the Employment Security Department (ESD):

 

What the map itself really shows is that there are effectively three states of Washington – two geographic centers of employment, and everyone else. The two employment centers are:

  • The I-5 corridor, especially King and Snohomish counties, with an average rate for the 8-county corridor at 6.7%.
  • The Eastern Washington agricultural and winery centers, whose average for the 7-county area was slightly over 6.5%, or for a wider 10-county area was 7.7%.

So the long answer is that, yes, we have the 5th highest U.6. in the country, but that is because of the way employment exists in our state.

But the most alarming rate of all should perhaps not be the unemployment rate, but the employment rate. If you look at ESD data, total Employment in April was listed as 3,239,780. The last time it was above that level? January 2009, when it was at 3,253,750. Before that, you have to go back to January of 2008, when it was 3,285,320. Tell me again, how is this a recovery?

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