Latest news with #GeneLudwig
Forbes
5 days ago
- Business
- Forbes
Stunning Unemployment Survey Says Millions 'Functionally Unemployed'
According to a new study, true unemployment in the United States is a stunning 24.3%, as millions of Americans are 'functionally unemployed." The bold claim is a stark contrast to the reported unemployment rate of 4.2% in April, as reported by the U.S. Bureau of Labor Statistics. But in a challenging study cited by CBS News, indications are that the government data might be painting an overly pretty picture for employment opportunities. New statistics on U.S. unemployment. getty The Ludwig Institute for Shared Economic Prosperity (LISEP) index indicates an increase in 'functional unemployment' that, according to reports, has topped 24% for the last three months. That's a sharp contradiction to the much-smaller government reported unemployment numbers. "We are facing a job market where nearly one-in-four workers are functionally unemployed, and current trends show little sign of improvement," said LISEP Chair Gene Ludwig. 'The harsh reality is that far too many Americans are still struggling to make ends meet, and absent an influx of dependable, good-paying jobs, the economic opportunity gap will widen.' LISEP's measure encompasses not only unemployed workers, but also people who are looking for work but can't find full-time employment, as well as those stuck in poverty-wage jobs, according to CBS News. The LISEP study seeks to capture labor market nuances that other economic indicators miss, such as Americans who are left behind during periods of economic expansion. Ludwig explains that the unemployment data from the BLS (Bureau of Labor and Statistics) is flawed. "For example, [government data] The study tracks what's called a True Rate of Unemployment (TRU). In a nutshell, this metric tracks the jobless plus those seeking, but unable to find, full-time employment. The LISEP number also includes those in poverty-wage jobs. 'If you're part time and can't get a full-time job, then we count you as functionally unemployed,' Ludwig says. People that don't have steady work and whose jobs don't allow them to live above the poverty line are, in essence, 'functionally unemployed.' The 2025 Federal Poverty guideline, for the contiguous 48 states and District of Columbia, is $32,150 per year for a family of 4, or $15,650 for one person. Note that this single annual income translates to $7.83 per hour, assuming a 40 hour week and 50 weeks worked per year. For a family of four the hourly wage rate is just over $16 per hour. The LISEP data contradicts the current unemployment rate, which remains at or near 50-year lows. Employers continue to hire, although at a slightly slower pace than April, when the economy added 177,000 jobs. So, what's the real number here? Indeed's Hiring Lab says that most official reports are still failing to capture the full labor market impact of rapid policy changes that have marked the first five months of this year. While some employers are in a 'wait-and-see' mode, industries like construction, manufacturing, healthcare, professional services and tourism are continuing to see increased job postings and hiring opportunities. To be sure, the U.S. job market is a complex and multi-faceted system. Trade wars and tariffs have not slowed down the U.S. job market, but headwinds remain for many - including government workers and technology workers that have experienced layoffs. Reports continue to share challenging job prospects for middle managers, within a complex macroeconomic picture. Unemployment numbers really depend on how jobs are counted, and what counts as a 'job'.
Fast Company
5 days ago
- Business
- Fast Company
Nearly a quarter of the U.S. is ‘functionally unemployed.' Here's what that means
According to the U.S. Bureau of Labor Statistics, unemployment rates have not shifted much in recent years. The current unemployment rate is reported as being 4.2%—just a slight increase from the 4% it hovered around between 2022 and 2024. But according to a new report, another measure of unemployment is much higher, and steadily growing. The April report, which comes from the Ludwig Institute for Shared Economic Prosperity (LISEP), a nonprofit that produces original economic research, documents what it calls the ' true rate' of unemployment. That rate refers to 'functional unemployment,' which takes into account those who are job-seeking yet unable to find work, as well as those with full-time jobs but whose earnings put them below the poverty line (under $25,000/year). The functional unemployment rate has risen for three consecutive months and is currently 24.4%. That means about one in four U.S. adults are considered functionally unemployed. LISEP Chair Gene Ludwig said in a press release that the outlook on the trend shows 'little signs of improvement' amid lack of an 'influx of dependable, good-paying jobs.' The report showed the functional unemployment rate rising 1.4% among Black workers to 26.7%. It decreased slightly for white workers, moving from 23.1% to 23%. While the rate for men increased (by 1.2%) bringing the total to 20%, women narrowed the gender gap. Women's true unemployment rate dipped 0.8 percentage points to 28.6%. While it's no secret that the federal government has been steadily shedding jobs, there haven't been major increases in the unemployment rate. However, the new findings paint a grim picture of how many U.S. workers are struggling to find employment and a livable income. Meanwhile, wage increases haven't kept up with a rising cost of living, not to mention the cost to raise a child, which has ticked up 25% in the past two years alone. 'Amid an already uncertain economic outlook, the rise in functional unemployment is a concerning development,' Ludwig explains. 'This uncertainty comes at a price, and unfortunately, the low- and middle-income wage earners ultimately end up paying the bill.'
Yahoo
6 days ago
- Business
- Yahoo
About 1 in 4 Americans are "functionally unemployed," researcher says
While the unemployment rate remains near a 50-year low, another measure of worker well-being indicates there may be bigger cracks in the labor market. The low unemployment rate, which stood at 4.2% in April, has signaled to economists and investors alike that the U.S. economy remains relatively healthy. Employers are also continuing to hire despite headwinds like tariffs and plunging consumer confidence. But another indicator suggests those pieces of government data may be painting an overly rosy picture of the economy, with a recent report from the Ludwig Institute for Shared Economic Prosperity (LISEP) finding the "true rate" of unemployment stood at 24.3% in April, up slightly from 24% in March, while the official Bureau of Labor Statistics rate remained unchanged at 4.2% over the same period. LISEP's measure encompasses not only unemployed workers, but also people who are looking for work but can't find full-time employment, as well as those stuck in poverty-wage jobs. By tracking functionally unemployed workers, the measure seeks to capture labor market nuances that other economic indicators miss, such as Americans who are left behind during periods of economic expansion. "The unemployment data, as it's put out, has some flaws," LISEP chairman Gene Ludwig told CBS MoneyWatch. "For example, it counts you as employed if you've worked as little as one hour over the prior two weeks. So you can be homeless and in a tent community and have worked one hour and be counted, irrespective of how poorly-paid that hour may be." LISEP, in a working paper on the gauge, says the measure prevents part-time jobs or poorly paid work from being counted as equal to full-time and better-paid work. LISEP also argues that the unemployment rate "presents a very incomplete and, in many ways, misleading picture." In other words, people who lack steady work and don't earn living wages shouldn't be counted as functionally employed. Its True Rate of Unemployment (TRU), which began tracking the measure in 2020, encapsulates workers whose earnings don't allow them to make ends meet, and are struggling just to get by, according to LISEP. "If you're part time and can't get a full-time job, then we count you as functionally unemployed," Ludwig noted. "We also count as functionally unemployed people who don't earn above a poverty wage." "Survival mode" In so doing, it counts workers who can't afford to put roofs over their heads, can't procure nuturious meals and don't have the ability to save as being functionally unemployed. "You don't have anything that gets you to the first rung of the American dream ladder. You're in survival mode," Ludwig said. When broken down by race and gender, TRU shows Hispanic, Black and women workers faring worse than White workers, as well as men. More than 28% of Hispanic workers, and nearly 27% of Black workers are functionally unemployed, compared to 23% of White workers. And more female workers — 28.6% — are functionally unemployed than male workers, whose true rate of unemployment stands at 20%, according to LISEP. Millions of households are currently struggling to maintain a "minimal quality of life," according to another recent analysis from LISEP. Its research found that the lowest-earning Americans around the U.S. are falling well short of what they need to maintain a decent standard of living. These households earned an average of $38,000 per year in 2023, but would need to make $67,000 to afford the items the group tracks as part of its index, which also includes the cost of professional clothing and basic leisure activities. The wide chasm between the the BLS's measure of unemployment and its true rate of unemployment is also concerning, according to Ludwig. "If you say there's 4.2% unemployment, which makes political folks happy because it's a low number, it causes all kinds of poor policy decisions and assumes we are better off than we are," Ludwig said. "There's less energy and less of a push to improve employment, and the people who get hurt at middle- and low-income Americans." Delta Air Lines' 100th year takes flight 9 young siblings killed in Israeli airstrike in Gaza Full interview: Jack McCain on "Face the Nation"
CBS News
6 days ago
- Business
- CBS News
Are you "functionally unemployed"? Here's what the unemployment rate doesn't show.
While the unemployment rate remains near a 50-year low, another measure of worker well-being indicates there may be bigger cracks in the labor market. The low unemployment rate, which stood at 4.2% in April, has signaled to economists and investors alike that the U.S. economy remains relatively healthy. Employers are also continuing to hire despite headwinds like tariffs and plunging consumer confidence. But another indicator suggests those pieces of government data may be painting an overly rosy picture of the economy, with a recent report from the Ludwig Institute for Shared Economic Prosperity (LISEP) finding the "true rate" of unemployment stood at 24.3% in April, up slightly from 24% in March, while the official Bureau of Labor Statistics rate remained unchanged at 4.2% over the same period. LISEP's measure encompasses not only unemployed workers, but also people who are looking for work but can't find full-time employment, as well as those stuck in poverty-wage jobs. By tracking functionally unemployed workers, the measure seeks to capture labor market nuances that other economic indicators miss, such as Americans who are left behind during periods of economic expansion. "The unemployment data, as it's put out, has some flaws," LISEP chairman Gene Ludwig told CBS MoneyWatch. "For example, it counts you as employed if you've worked as little as one hour over the prior two weeks. So you can be homeless and in a tent community and have worked one hour and be counted, irrespective of how poorly-paid that hour may be." LISEP, in a working paper on the gauge, says the measure prevents part-time jobs or poorly paid work from being counted as equal to full-time and better-paid work. LISEP also argues that the unemployment rate "presents a very incomplete and, in many ways, misleading picture." In other words, people who lack steady work and don't earn living wages shouldn't be counted as functionally employed. Its True Rate of Unemployment (TRU), which began tracking the measure in 2020, encapsulates workers whose earnings don't allow them to make ends meet, and are struggling just to get by, according to LISEP. "If you're part time and can't get a full-time job, then we count you as functionally unemployed," Ludwig noted. "We also count as functionally unemployed people who don't earn above a poverty wage." "Survival mode" In so doing, it counts workers who can't afford to put roofs over their heads, can't procure nuturious meals and don't have the ability to save as being functionally unemployed. "You don't have anything that gets you to the first rung of the American dream ladder. You're in survival mode," Ludwig said. When broken down by race and gender, TRU shows Hispanic, Black and women workers faring worse than White workers, as well as men. More than 28% of Hispanic workers, and nearly 27% of Black workers are functionally unemployed, compared to 23% of White workers. And more female workers — 28.6% — are functionally unemployed than male workers, whose true rate of unemployment stands at 20%, according to LISEP. Millions of households are currently struggling to maintain a "minimal quality of life," according to another recent analysis from LISEP. Its research found that the lowest-earning Americans around the U.S. are falling well short of what they need to maintain a decent standard of living. These households earned an average of $38,000 per year in 2023, but would need to make $67,000 to afford the items the group tracks as part of its index, which also includes the cost of professional clothing and basic leisure activities. The wide chasm between the the BLS's measure of unemployment and its true rate of unemployment is also concerning, according to Ludwig. "If you say there's 4.2% unemployment, which makes political folks happy because it's a low number, it causes all kinds of poor policy decisions and assumes we are better off than we are," Ludwig said. "There's less energy and less of a push to improve employment, and the people who get hurt at middle- and low-income Americans."
Yahoo
15-05-2025
- Business
- Yahoo
New Study Says Most Americans Can't Afford a Basic Life
A new study paints a grim picture of American economic life: Most households aren't making enough to cover the basic costs of living, even when working full time. According to the Ludwig Institute for Shared Economic Prosperity (LISEP), the majority of Americans are falling short of what the organization calls a 'Minimal Quality of Life.' The report defines that standard not just by food and shelter, but also by access to education, healthcare, professional clothing, child care, and basic leisure—essentials for stability, not luxury. The analysis zeroes in on the bottom 60% of U.S. income earners, who brought in an average of $38,000 in 2023. To meet the threshold for a minimal standard of living, they'd need to earn about $67,000, which is almost double their current income. 'The middle class has been declining — we just haven't recognized it fully,' LISEP Chairman Gene Ludwig told CBS News. 'The American dream isn't supposed to mean living in a tent or stealing to survive. It's about having a shot at a decent life through hard work.'From 2001 to 2023, the cost of this 'American dream basket' doubled. In-state public college tuition jumped 122%. Health care and housing spiked. Meanwhile, median wages for the bottom 60% fell by 4% after adjusting for those same costs. While top earners have seen faster income growth, the rest are barely treading water. And unless something changes, the divide is only going to widen. LISEP says the goods and services that define a basic standard of living are inflating faster than wages can keep up with. In other words, the American economy may be growing, but for most U.S. households, it's not growing in a way that feels like progress.
