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U.S. Unemployment Improves in October

U.S. Unemployment Improves in October

by Dennis Jacobe

PRINCETON, NJ -- Unemployment, as measured by Gallup without seasonal adjustment, is at 8.4% at the end of October, down from 8.7% in September and 9.2% in August. Unemployment was at 8.3% in mid-October -- its lowest level since Gallup began continuous monitoring in January 2010. Gallup's unemployment measure is also now much lower compared with a year ago -- it stood at 9.4% at the end of October 2010.

Gallup's U.S. Unemployment Rate, 2010-2011

The percentage of part-time workers who want full-time work is at 9.4%, down from 9.6% at the end of September.

Percentage of U.S. Workers Working Part Time and Wanting Full-Time Work, 2010-2011

Underemployment, a measure that combines the percentage of workers who are unemployed with the percentage working part time but wanting full-time work, is 17.8% at the end of October -- down from 18.3% at the end of September.

Gallup's U.S. Underemployment Rate, 2010-2011

Looking Ahead to Friday's Government Unemployment Report

The government's seasonally adjusted October unemployment report, to be released Friday, will be based on data collected during mid-October, around the time Gallup released its mid-month findings. At that time, Gallup suggested that the government would report a drop in the U.S. unemployment rate for October. The continued improvement Gallup has found in the job situation since mid-month reinforces this idea. Gallup modeling suggests the government's unemployment rate could fall below 9.0% for October.

Gallup's October data are consistent with Wednesday's Challenger, Gray, & Christmas report showing that planned layoffs in October were at their lowest level since June. The decline Gallup finds in unemployment also aligns with the 2.5% increase in U.S. GDP for the third quarter and the Federal Reserve's statement on Wednesday suggesting the economy is strengthening modestly. Additionally, Gallup Daily tracking shows economic confidence, consumer spending, and job creation improving in October.

However, Gallup's view that the unemployment rate is likely to decline is not aligned with the current consensus that it will remain unchanged. It also does not fit with the report Wednesday from ADP, the nation's largest payroll service, which found a rise of 110,000 in private-sector payrolls during October.

One caveat is that Gallup's unemployment numbers are not seasonally adjusted, and the way the government adjusts its unemployment report for seasonal effects may affect Friday's report. Last month, the government's not-seasonally adjusted unemployment rate declined from 9.1% to 8.8%, while the seasonally adjusted rate remained unchanged. Last year, the government's not-seasonally adjusted rate fell from 9.2% in September to 9.0% in October, yet the seasonally adjusted rate increased from 9.6% to 9.7%. So how the government seasonally adjusts its October results can offset the improvements actually taking place in the job market during the month, although Gallup's data suggest that the improvement is likely more than a seasonal change.


A modest improvement in the government's unemployment rate -- particularly one involving a drop below 9.0% -- could have a major psychological effect on the country. It would surprise the markets and the nation's politicians, and possibly give consumers hope. However, such a decline would not change the fact that the U.S. continues to have extremely high unemployment and underemployment rates, as well as a fragile overall economy. Further, many of these jobs could be temporary and disappear after the holidays.

Regardless, Gallup data suggest this is the best time to get a job in nearly two years. Given the current job situation, even a temporary job is better than no job.

How Gallup's Unemployment Measure Differs From the U.S. Government's Measure reports results from these indexes in daily, weekly, and monthly averages and in stories. Complete trend data are always available to view and export in the following charts:

Daily: Employment, Economic Confidence and Job Creation, Consumer Spending
Weekly: Employment, Economic Confidence, Job Creation, Consumer Spending

Read more about Gallup's economic measures.

View our economic release schedule.

Survey Methods

Gallup classifies American workers as underemployed if they are either unemployed or working part time but wanting full-time work. The findings reflect more than 18,000 phone interviews with U.S. adults aged 18 and older in the workforce, collected over a 30-day period. Gallup's results are not seasonally adjusted and are ahead of government reports by approximately two weeks.

Results are based on telephone interviews conducted as part of Gallup Daily tracking from Oct. 1-30, 2011, with a random sample of 18,658 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia, selected using random-digit-dial sampling.

For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±1 percentage point.

Interviews are conducted with respondents on landline telephones and cellular phones, with interviews conducted in Spanish for respondents who are primarily Spanish-speaking. Each sample includes a minimum quota of 400 cell phone respondents and 600 landline respondents per 1,000 national adults, with additional minimum quotas among landline respondents by region. Landline telephone numbers are chosen at random among listed telephone numbers. Cell phone numbers are selected using random-digit-dial methods. Landline respondents are chosen at random within each household on the basis of which member had the most recent birthday.

Samples are weighted by gender, age, race, Hispanic ethnicity, education, region, adults in the household, and phone status (cell phone only/landline only/both, cell phone mostly, and having an unlisted landline number). Demographic weighting targets are based on the March 2010 Current Population Survey figures for the aged 18 and older non-institutionalized population living in U.S. telephone households. All reported margins of sampling error include the computed design effects for weighting and sample design.

In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

For more details on Gallup's polling methodology, visit

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