The unemployment rate August despite the addition of 187,000 job

Typically, the unemployment rate declines when the economy creates a large number of jobs in a given month. That wasn’t the case in August.

Despite the 187,000 new jobs added last month, the unemployment rate rose to 3.8% from 3.5% in July. That’s the biggest one-month jump since May. And prior to the start of the epidemic, November 2011 marked the last time the jobless rate reached that high a level in a single month.


What gives?

By definition, the unemployment rate measures the proportion of the labor force that is jobless. The entire number of persons who employe and unemploye is known as the labor force. You don’t absolutely need to have been laid off recently to be regard as unemploye.

According to the Bureau of Labor Statistics, if a person is not employed but is looking for employment and has made an effort to do so within the last month, they are considered to be unemployed. They are not regard as being employe if they don’t meet that standard.

The number of unemployed persons increased by 514,000 to 6.4 million last month. However, the number of employed individuals increased by 222,000 to 161.5 million. The overall result was a 736,000 increase in the labor force, bringing it to 167.8 million people. Mathematically, the 3.8% unemployment rate is calculate by dividing 6.4 million by 167.8 million.

Regardless of the numbers, this indicates that more people began actively hunting for employment last month, even if they hadn’t recently lost their jobs. Additionally, fewer individuals had occupations at the period.

But wait, wasn’t there an increase of 187,000 employment last month?

That is accurate. Technically, there were 187,000 more people working on nonfarm payrolls. The BLS’s monthly survey of more than 100,000 businesses and government organizations yielded that result. The information used to determine the unemployment rate, however, comes from a distinct monthly survey that the Census Bureau performs for the BLS of roughly 60,000 households.

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