Long Term Perspective
The civilian unemployment rate reflects the degree of tightness in the labor market. The unemployment rate generally associated with "full employment" -- the level that causes wage pressures to begin percolating -- is about 5 percent. The question of the "full employment rate" is debated widely among academics and policymakers. It wasn't until late 2000 that Fed chairman Alan Greenspan admitted to the lower unemployment rate as full employment - until recently, most policymakers still felt it was closer to 5 ½ percent. The "full employment unemployment rate" can change depending on the demographic structure of the labor force.

Short Term Perspective
The civilian unemployment rate jumped to 6 percent in November after heading lower in the past few months. The jobless rate often rises in the early stages of recovery as more people enter the labor force when they believe it will be easier to find work. Average hourly earnings rose 2.9 percent in November. The downward trend in wage hikes will likely continue for a few more months.

Alternative Inflation Measures   •   Gold Prices   •   Employment Cost Index   •   Civilian Unemployment Rate

Pool of Available Labor   •   Nonfarm Productivity   •   Treasury Yields   •   Stock Prices   •   Fed Monetary Policy Summary