The real misery rate: 24 percent

In Oregon, one in four people can’t find full-time jobs

By peter korn

The Portland Tribune, Aug 13, 2009, Updated Oct 30, 2009 (10 Reader comments)

L.E. BASKOW / TRIBUNE PHOTO

George Snipes uses a computer at WorkSource Oregon to search for possible job openings. The Vietnam veteran was laid off last November and now is applying for part-time work.

Here’s the thing that worries unemployed Woodstock resident George Snipes: What if things are worse, much worse, than we are being told?

They are, says Andrew Sum, an economist who heads the Center for Labor Market Studies at Northeastern University in Boston. Sum has analyzed employment data for all 50 states, and he says that those charts provide statistical verification of what Snipes feels in his gut: Oregon’s 12.2 percent official unemployment rate is something of a red herring and far from a true indicator of the social hardship taking place in Oregon today.

If you really want to know how much people are suffering, Sum says, check out Oregon’s labor underutilization rate. That number combines the unemployed with two other categories of workers who don’t make it into the official unemployment rate – underemployed workers who want full-time work but can only find part-time jobs, and unemployed people who say they want work but have given up looking.

Combining those two categories with the state’s official unemployment rate brings Oregon’s rate up to 23.8 percent for the first six months of 2009, and over 24 percent for the past three months. That’s the worst in the nation, according to the center’s data, and it means nearly one in every four work-ready Oregonians is struggling to get by, an unprecedented number in post-depression America.

Sadly, a closer look at the data makes the numbers, and Oregon’s prospects, look even worse.

For instance, more than 53.5 percent of Oregon’s unemployed lost jobs that are never coming back, according to the Center for Labor Market Studies’ data. In just two years, that rate – what some economists call permanent job losses – has tripled in Oregon. That’s a growth rate that Sum also says is unprecedented.

Oregon has the nation’s highest percentage of underutilized workers — those who are unemployed, combined with those working part time who want full-time jobs.

Economists like to look at trends, and Oregon’s 24.1 percent underutilization rate represents an 11.3 percent increase over a year ago, the steepest increase in the nation. In no previous recession, Sum says, did the combined unemployed and underemployed worker rate shoot up as dramatically as it has in the past 18 months.

“I’ve never seen numbers like this in my entire life,” Sum says.

The numbers may help explain why, according to the latest figures from the Oregon Department of Human Services, one in six Oregonians is dependent on food stamps to get by.

One in four Oregonians jobless, or making ends meet with part-time work, is a little higher than George Snipes expected, but he says he’s figured for a while that the official 12 percent unemployment rate was lowballing the truth.

Snipes, 62, has held four jobs since returning from military service in Vietnam in 1968, with no more than two or three months unemployment in between jobs – until now. He worked cutting up plastic at a Portland plastic wholesaler for 13 years before getting laid off in November. In fact, he says, of the 12 plastic cutters who worked at the company, three have been laid off – one in four, he notes, just like the state average.

Snipes hasn’t been able to find work since November, and he’s been looking hard. Last Friday he interviewed for a 20-hour-a-week job that would pay him $12 an hour unloading trucks on a midnight shift. If he gets offered the job, he’ll accept it, even though he might only end up with about $800 a month in take home pay.

If Snipes takes that job, he will no longer be counted in Oregon’s official unemployment rate, despite the fact that he will be working at far less than the full-time job he needs.

University of Oregon economist Tim Duy says with talk of the recession’s end getting closer, it is possible that end will be a “jobless” one.

But Snipes wonders how that could be considered an end at all.

“The thing I hate to think of is that this might go on for 10 years,” Snipes says. “I think it’s a real possibility.”

A preview of what’s to come

Duy is not only concerned that whatever recovery follows the current recession doesn’t include jobs. He’s also worried that people who have become unemployed this time might be “permanently disadvantaged.”

“People who go part time never get their earnings back,” he says. “One in four is a big number.”

Heidi Shierholz, a labor economist at the Washington, D.C.-based Economic Policy Institute, says it makes little sense for states to continue to release traditional unemployment numbers each month.

“Unemployment is less and less relevant for a modern labor force,” Shierholz says. “We no longer have a world where it’s men working full-time jobs.”

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