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Underemployment is a broad concept describing labor resources that are not fully used. It can include unemployment, people working part time because they cannot find full-time work, and people who want a job but are not counted in the official labor force.
U-3: the official unemployment rate
U-3 measures unemployed people as a percentage of the civilian labor force. To be unemployed under BLS definitions, a person generally must be jobless, available for work, and actively searching, or be on temporary layoff.
Discouraged workers
Discouraged workers want a job and are available to work but have not searched recently because they believe no jobs are available for them or face related job-market discouragement. They are outside the official labor force and therefore not included in U-3.
Marginally attached workers
Marginally attached workers want and are available for work and have looked sometime in the previous 12 months, but not in the most recent four weeks. Discouraged workers are a subset of this group.
Part time for economic reasons
These are people working part time because their hours were reduced or because they could not find full-time work, even though they want and are available for full-time work.
U-6: the broadest BLS measure
U-6 includes unemployed people, all marginally attached workers, and people working part time for economic reasons. The denominator is adjusted to include the marginally attached.
Why U-6 is always higher than U-3
U-6 includes every person counted in U-3 plus additional groups experiencing labor underutilization. It is therefore broader by design.
Underemployment is not one single statistic
Someone may also feel underemployed because a job does not use their skills or education. That subjective or occupational mismatch is not fully captured by U-6. BLS alternative measures focus on labor-force status and hours, not whether a worker feels appropriately matched to a role.
Why the broader measures matter
A low official unemployment rate can coexist with elevated involuntary part-time work or marginal attachment. Looking at U-3 and U-6 together can reveal whether labor slack extends beyond people counted as officially unemployed.
How to read the data
- Use U-3 for the official unemployment rate.
- Use U-6 when you want a broader measure.
- Check labor-force participation.
- Check part-time-for-economic-reasons counts.
- Look at trends, not only one month.
Continue learning
Read Unemployment Rate Explained, Labor-Force Participation Rate Explained, and visit the Jobs & Wages hub.
Sources & methodology
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Sources, dates, and methodology matter.
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