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With rising productivity at an advanced age, common concerns for older people facing job losses revolve around their pension and unemployment benefits. Senior citizens can avail UI benefits as there is no age limit to claiming them. This is as long as you have not withdrawn from the labor market, and you meet the other eligibility criteria.

Unemployment Insurance is a government initiative that is funded by collections from employers and not taxpayers. It helps workers financially while they are unemployed and looking actively for work. You can claim UI benefits while drawing social security benefits and pension payments, though it would be subject to deductions as per the pension plan.

When Can I Retire and Claim Unemployment Insurance?

As per the Social Security Administration of the US, the earliest retirement age is 65, for people who were born in 1937 or earlier. For each year after 1937 until 1943, the age increases successively by two months, culminating in 66 for those born between 1943-1954. From 1955, the age increases similarly by two months each successive year to 67 for those born in 1960 and later.

Thus, if you were born in 1957, you would retire at 66 years and six months.

Can I Collect Unemployment Benefits if I Retire Early?

If you have taken early retirement, unemployment benefits could be claimed by you. However, this only applies if you were laid off for no fault of your own and/or compelled to accept an early retirement package by your employer to reduce the workforce. 

You may also be able to claim UI benefits if you had to retire due to health and safety reasons, and your employer failed to provide you with suitable alternative work. The exact conditions vary from state to state, so refer to your state’s website for details.

Does Pension Affect Unemployment Benefits?

Pension refers to any periodic payment which may be employer-contributed, governmental, union, from sharing profits, annuity, etc. Most states such as Georgia, California, etc. reduce the unemployment compensation of those who receive pension payments. This is not to be confused with social security benefits, which are not affected by pension or UI benefits. If you live in Florida or Michigan you should check out how you can file for unemployment benefits. 

Typically the weekly benefit amount is reduced by the amount contributed by your base period employer towards your pension (if they contributed 50% or more). If you draw upon your retirement plans like a 401(k) that too is subject to deduction, based on those amounts, the weekly benefit amount payable to you could drop to zero, thus disqualifying you.

The other requirements you would have to satisfy to claim unemployment insurance include:

  • Meeting all the reporting requirements
  • Registering for work with the state portal and proving that you are actively looking for work
  • Drawing the threshold wage during your base period (which may vary across states)
  • Being unemployed through no fault of your own

Older workers who get laid off have a tougher time finding new jobs compared to younger workers. As the unemployment compensation is not considered as income under the social security earnings, it is an added advantage for senior citizens and retirees who can also draw social security benefits.

Applicants should remember to file their claims as quickly as they can, regardless of whether they have been served the unemployment notice by their employer.


As per the employment situation report for September, the unemployment rate is reduced by 0.2 percentage points to reach 3.5 percent. With this, the unemployment rate is said to have reached a 50-year low, matching the figures of December 1969.

Major Ups and Downs in September

The unemployment rate has remained below 4 percent for the 19th month in a row. The unemployment rate stands at a 50-year low, which highlights further strengthening of the labor market in the United States.

The month of September has witnessed positive changes in job creation, where the total non-farm payrolls rose by 136,000. However, this figure is considerably lesser compared to the month-on-month for 2019, which stands at 161,000. It is also lower than the overall average for 2018, which stood at 223,000. 

The total payroll for July and August has been revised, and where the total payroll increase for these months is increased to 159,000 and 168,000 respectively. In comparison to these months, it is evident that the payroll increase for September is low.

One of the positive indicators for the month of September is that the rate of discouraged workers has come down by 0.3 percent points, matching the 19-year low record. It is also just 0.1 percent away from matching the all-time low figure of 6.8 percent.

In spite of the drop in the unemployment rate, there are other important concerns that are reflected in the report published by the employment situation report for September published by Bureau of Labor Statistics. One of the main issues highlighted in the report is that on wage growth. Over the last 12 months, wages have increased by 2.9 percent, which is the lowest since July 2018.

The reducing rate of job creation and low growth of wages will still remain to be a matter of concern in spite of the drop in the unemployment rate.

Establishment Survey Data

The payroll growth is below average for the month of September (136,000), which is lesser than the forecast made by experts (145,000). Sectors that have performed well in the month are health care and in professional and business services, which have added a major chunk of jobs.

The Health Care sector has added 39,000 jobs in September, which is in line with its average monthly gain for the last 12 months. The Professional and Business Services sector, on the other hand, has added 34,000 jobs in the month, which is marginally lesser than its monthly average for 2019, which stands at 35,000. 

Other sectors such as Transportation and Warehousing and Government sectors too have seen an upward trend in September, with each sector adding 16,000 and 22,000 jobs respectively. 

The sector with most job loss for September is Retail Trade, which has recorded a payroll loss of 11,000 for September. The report states that since its peak in 2017, the sector has lost nearly 197,000 jobs.

Sectors such as Mining, Construction, Manufacturing, Wholesale Trade, Information, Financial Activities, and Leisure and Hospitality have seen little to no change in its performance for the month.

Household Survey Data

The unemployment rate has come down marginally for most of the major worker groups. The unemployment rate for major worker groups stands at:

Workers Groups Unemployment Rates
Adult Men 3.2 percent
Adult Women 3.1 percent
Teenagers 12.5 percent


Workers Groups Unemployment Rates
White population 3.2 percent
Black population 5.5 percent
Hispanic population 3.9 percent
Asian population 2.5 percent

The unemployment rate has come down for marginally for adult men, women and teenagers. Among the racial groups, unemployment rate Hispanics have seen a reasonable improvement, which has come down for 4.2 percent to 3.9 percent. The unemployment rate has come down for the Asian population as well, but there has been no change in the rate for the black population.

Final Analysis

There have been some very positive improvements in the employment situation for the month of September. The unemployment rate has reached a 50-year low, and there has been an increase in the new entrants in the job market. The job market has also witnessed a decline in the number of job losers and persons who completed temporary jobs. 

These developments mark a positive trend, but there are some challenges too that need to be addressed. Issues such as low wage growth and low growth of payroll are considerably important issues that need to be addressed at the earliest.


The Unemployment Insurance (UI) benefits program is designed to provide financial assistance to those who have lost jobs for no fault of their own. To qualify for the benefits, applicants must have earned sufficient wages in their previous employment. Along with wages, the reason for separating from previous organization plays a crucial role in deciding if an application makes the cut for the UI Benefits. If applicants don’t fulfil these conditions, it will result in an instant the disqualification of UI benefits.    

It is also necessary to disclose the reason for separating from the previous organization. The applicants must demonstrate that they did not lose the job due to any fault of their own. Here are some of the most common reasons for people to separate from previous employment which will lead to disqualification from receiving UI Benefits:

1. Voluntary Resignation

If you voluntarily resigned from your previous job, your application for UI Benefits is most likely to get rejected. Reasons such as loss of interest in the job or a need to take a break from work are not given due consideration by most states. 

However, some cases of voluntary resignations are taken into consideration in a few states. If the reasons for voluntary resignation are; you were not paid for your work, the working conditions were hazardous, or there were illegal activities taking place in the organization, or if you accompanied your spouse who had to relocate due to his/her job, etc. Also, issues like workplace harassment and compelled to quit due to domestic violence are taken into consideration.

Applicants must have sufficient evidence to back their claim to make sure that their applications get considered. If you quit your job for any acceptable reason, along with the evidence for your claim, you must also provide evidence to prove that you tried to solve the issue prior to resigning. The applicants must take note that the burden of proof lies on them and not on the employers.

2. Criminal Charges or Conviction

If you lost your previous job due to a criminal charge and were convicted for the same, your application for benefits will be disqualified. The duration of disqualification differs from state-to-state but such individuals are generally disqualified for a significantly long period of time.

3. Work-related Issues or Bad Reviews

If you were fired by your previous organization for reasons relating to your performances, your application will be rejected. Once you file for unemployment, the department which oversees matters relating to UI Benefits in your state will share the application with your ex-employer to verify the claim. If your ex-employer states poor performance as a reason for your exit, your eligibility will be immediately withdrawn.

In such cases, the disqualified individuals are expected to work again for another employer. They must also eliminate the wages earned and hours worked for this employer while calculating their base period wages.  

4. Non-US Citizen (Immigrant workers)

Individuals who are not citizens of the United States are not allowed to work in the country without receiving a letter of permission. Applications submitted by non-citizens will instantly be rejected without the required documents.

The non-citizens will receive a registration number when they apply for a work permit, which is also known as ‘Alien Registration Number’. They need to submit the alien registration number without fail when they apply for UI Benefits.


Unemployment benefits are not collected by the employees nor does the government pay it from its funds. The UI Benefits program is funded by the employers, and therefore all the state governments take extra precautions to make sure that you meet all the eligibility conditions. Check out the eligibility conditions set for the state you belong to know in detail about the rules by your state. If in case your application gets disqualified, note that you could always file for an appeal challenging the decision.


Key Points:

  •  Total nonfarm payroll employment in August rose by 130,000. The rise in June was 178,000
  •  Increase in the average hourly earnings to 0.4 percent in August  from 0.3 percent in July
  • The labor participation rate has risen from 63 percent in July to 63.2 percent in August


The employment situation for August shows that the rate of unemployment remains unchanged at 3.7 percent. The report for August contains a mixed bag of results, where some indicators have seen a slump, whereas others have seen a promising rise. 

Major Ups and Downs in August

The total nonfarm payroll employment rose by 130,000. This is less than the revised average of 156,000 per month for the last three months. The job growth rate for the month has been poorer than in the previous months.

The data for June and July, although indicate higher growth than August, has been revised from the previously acknowledged figures. The payroll growth for the month of June has been revised from 193,000 to 178,000, and the payroll increase for July has been revised from 164,000 to 159,000 as per the Bureau of Labor Statistics

The payroll growth for August has been considerably lesser than the rise witnessed in June and July, and this indicates a major slowdown in job creation for the month of August.

The challenges faced in August was not helped by the fact that, apart from the federal hiring, private payroll only grew by 96,000. This is considered to be the slowest pace of growth since February 2019. Also, the rise in federal hiring is largely due to the hiring of temporary workers for the 2020 survey. 

On the positive side, the month of August has also witnessed an increase in the average hourly earnings, which rose to 0.4 percent from 0.3 percent in July. Also, the labor participation rate has seen a marginal rise from 63 percent to 63.2 percent

Establishment Survey Data

The payroll growth (130,000) in August has been less than the average growth recorded so far in 2019, which stands at 158,000. The slump appears to be greater when compared to the overall average of the year 2018, which stood at 223,000.

There was an increase in private-sector employment by 96,000 with notable gains made in the healthcare sector and the financial sector. The public-sector employment rose by 28,000, largely due to the recruitment of 25,000 temporary employees for 2020 census work.

The health care sector has added 24,000 jobs in August, taking the value for the last 12 months to 392,000. The financial sector too added 15,000 jobs for the month, taking its 12-month tally to 111,000. Other sectors that added jobs in August include the professional and business services sector, social assistance, and mining.

Sectors that changed little to none in August include construction, manufacturing, transportation

and warehousing, and leisure and hospitality. The retail sector, on the other hand, lost about 15,000 jobs in the month.

Household Survey Data

There are no major changes in the unemployment rate of the major worker groups. The unemployment rate for major worker groups stands at:

Workers Groups Unemployment Rates
Adult Men 3.4 percent
Adult Women 3.3 percent
Teenagers 12.6 percent
White population 3.4 percent
Black population 5.5 percent
Hispanic population 4.2 percent
Asian population 2.8 percent

According to the data from August, the unemployment for ‘adult women’, ‘teenagers’, ‘Black population’ and ‘Hispanic population’ has seen a marginal decrease in the rate of unemployment. 

The rate of labor force participation and the employment-population ratio has seen a marginal increase in August. Labor participation rate 63.2 percent, while the employment-population ratio also went up to 60.9 percent in August.  

Final Analysis

The rate of job growth has considerably slowed down. Experts point out that the disagreements in trade deals between the United States and China could be one of the important reasons for the slump the US is facing in job creation. 

However, the increasing wage rate and labor participation rate indicates a positive sign. It shows that people may make more money per hour than the earlier weeks and that more and more people are entering the job market. 


Most Americans decide to leave their jobs due to one or the other form of harassment meted out in the workplace. Toxic work environments affect people psychologically and their performance, making it an all-round bad experience for the employees. 

A study showed that nearly 60 percent of employees have quit or are on the verge of quitting their jobs because of the workplace harassment they face. There are many types of harassment that one may experience – racial, sexual, religious, ethnic, age-based, disability-based, bullying, or employers holding personal grudges against the applicants. 

This, however, gets complicated when one quits and applies for UI Benefits. The state unemployment benefits department has two major challenges.

The two biggest challenges that an applicant will face are:

  • The onus of proving that the harassment has taken place will be on the applicant
  • The applicant’s word will not be taken as final. If the employer contests the claim of the applicant, the applicant might end up losing the UI benefits if he/she does not have legitimate proofs

What Constitutes Harassment?

It is important for people to understand that you may not get along with your employer and this does not constitute harassment. Employers are not obligated to make you feel at home or make you get along with themselves or others. 

If you quit your job because you could not get along with your manager, your resignation will be considered as ‘voluntary’, and you will not qualify for UI benefits. 

For any case to be considered as harassment, the applicant must be treated unfairly based on factors that are beyond the employee’s performance or behavior. 

Some of the instances that are considered as harassment include:

  • Your work environment made hostile due to your gender, sexual orientation, race, religious affiliation, age, disability or due to personal enmity
  • Your work environment made hostile because you brought to light a criminal activity, health hazard, or discrimination faced by someone else either to your manager or to the police
  • You were ‘constructively discharged’ by your employer. Constructive discharge is when an employee is forced to quit due to the discrimination meted out against him/her     

How to Prove Your Claim?

There are some important steps you need to follow to make sure that you have sufficient evidence for your claims. 

Show that you tried to solve the issue: First and foremost, any state UI department will see if you have made any efforts in trying to solve the issue within the organization. You need to furnish proof that you have amply communicated with your manager about your issue. You need to show that you did not leave your job at the first sight of the problem, but instead, you tried to solve it but found no success.

File formal complaints: File formal complaints while you are still employed if you cannot solve the issue by yourself. Either file a complaint with a higher authority in your organization or you can also file a complaint with the ‘Equal Employment Opportunity Commission (EEOC)’. You can also file a complaint with your state or local government authorities like the police, or the Human Rights Division of your state. 

Documentation of your complaints: Make sure that all your communication about your issue is well documented. Communicating through emails is one of the smarter things to do while connecting with your manager. If you submitted a handwritten complaint, make sure to keep a photocopy of your submission. Keep the copies of complaints that you filed with the local government agencies or with the EEOC. 

This will form a major piece of evidence to showcase that you went through harassment and you tried to find a solution by informing the respective authorities. Such documented evidence will be the difference between your word and your employer’s word.

If you are left with no other option but to quit your job, you have arrived in the right place. Check out to know more about filing for UI benefits in your state. 

The employment situation for the month of July has seen little changes from the previous month. The unemployment rate remains at 3.7 percent in July, indicating that the rate remains unchanged.

The job growth, however, has not increased in comparison to the previous month. The important news to emerge from the ‘Employment Situation Report- July 2019’ is that the job growth numbers given for May and June have been revised. The total payroll gain is reported to be 41,000 less than that was previously reported for May and June combined.

The payroll increase for May is revised to 62,000 from the earlier reported figure of 72,000. The increase for the month of June is revised to 193,000 from the previously reported 224,000.

The nonfarm payroll jobs increase reported for the month of July is 164,000. The figure is lower than the newly revised figure of the previous month.

Establishment Survey Data

The job gain in July is in line with the average employment growth in the first six months of 2019. Some of the notable contributors in creating jobs for July are professional and technical services, health care, social assistance, and financial activities.

Professional and technical services added nearly 31,000 jobs for the month of July. This also takes the yearly average of the sector to 300,000, which accounts for one-third of all jobs created in the last year.

The jobs created by the healthcare sector for July is 30,000 for the month of July. The total jobs added by the health care sector over the year is about 405,000, which accounts for nearly two-thirds of all jobs created.

The jobs added by social assistance and financial activities sectors are 20,000 and 18,000 respectively in the month of July.

The average workweek for all workers has come down by 0.1 hours, standing at 34.3 hours in July. This decline has been steeper in the manufacturing sector, which registered a decline of 0.3 hours, standing at 40.4 hours.

The wage rate has seen a rise in July, keeping up with the rate that was recorded in the previous month. The average hourly earnings have increased by 8 cents, standing at $27.98. The rise in the previous month too was 8 cents, thus indicating that the rate of wage growth has not seen much difference in July.

Household Survey Data

The ‘major worker groups’ have not seen big changes in the rate of unemployment as compared to the previous month. The unemployment rate of the major workers’ groups for the month of June are:

Workers Groups Unemployment Rates
Adult Men 3.4 percent
Adult Women 3.4 percent
Teenagers 12.8 percent
White population 3.3 percent
Black population 6.0 percent
Hispanic population 4.5 percent
Asian population 2.8 percent

As per the data presented in July, there has been a marginal increase in the unemployment rate of adult men, women and teenagers. In the case of racial groups, there has been a marginal increase in the rate of unemployment for the Hispanic population. The only considerable difference appears in the rate of unemployment of the Asian population, which has come down to 2.8 percent from 2.1 percent in the previous month.

Final Analysis

Although the number of jobs created in July is lesser than the rate of growth in June and May, the overall growth rate seems stable. There has also been an increase in wages, which although is marginal, is a positive sign.

The unemployment rate stands at 3.7% as of June 2019. As you may know, unemployment benefits (UI) will help make up for lost wages when you are between jobs. When you are submitting unemployment claims, you should opt to file for UI benefits online as it is faster and more convenient.

There are many benefits in filing for UI benefits online. Read on to know how to go about filing claims online. All you will need is a simple internet connection, and the know-how of how to submit claims and you’re good to go!

How To File Your Unemployment UI benefits Online

Follow these steps to make your unemployment claim online:

1. Contact Your State Agency

Get in touch with your State unemployment agency via email, or phone or visit to check your benefits. Your state unemployment agency is your only point of contact if you want to receive unemployment claims.

2. Check Your Eligibility 

For an individual to avail benefits, you must have become unemployed through no fault of yours. You can check the benefits that you may receive using our base period calculator. The eligibility criteria for each state is different, and this will determine the weekly benefit amount you may receive.

3. Submit Your UI Benefits Online

Filing an unemployment claim is pretty easy nowadays, and with the advent of the internet, you can check your unemployment claims online. Always check what is your base period and if you are eligible before filing for UI benefits. 

4. File Your Weekly Claim

All individuals who file for claims are expected to file weekly claims truthfully and on time. To submit an online claim, you should submit a claim on the state’s unemployment website. It is recommended to file a claim in the state that you worked in. Always give complete information such as your home address and dates of your previous employer to make sure your unemployment pay is not delayed. 

Here Are Some Advantages To Why You Should File UI Benefits Online:

1. Time Efficient 

Filing claims online would ensure that you wouldn’t have to wait in long queues. You can file your claims at a time and place convenient to you. You don’t have the hassle of going to the insurance agency’s office and waiting for your turn. 

2. Accuracy

All the information provided on an insurance website is generally accurate and ensures individuals a step-by-step process on how to file unemployment returns. The chances of an error are minimal as the insurance websites are generally error-free. 

3. Mobile Friendly 

You can always use your mobile to sign up for federal benefits. Whether you are in the US or anywhere in the world you can file your claims on the mobile. This makes it extremely easy and convenient as you can file for your unemployment on the go. 

4. Cost Saving

You don’t need to pay for postage or fax expenses, as you can file for your unemployment returns from anywhere in the world all you need is a working internet connection.

A Quick Claim Solution

Why use age-old techniques like fax, phone, and email when everything can be done online. You can check how much you can claim on websites such as, get news, use free calculators to determine your benefits and readily available unemployment information. If you have a question about unemployment, benefits, making a claim or other details then you can always write to us in the comment section below.

The employment situation in June has shown promise in creating opportunities and increasing wage growth. The performance by the US economy has exceeded the expectations as it added nearly 224,000 jobs, thus providing more opportunities against the market expectations of 162,000 jobs. The employment situation in June, therefore, has created more optimism among the policy-makers and job seekers after a brief period of slow growth.

The rate of unemployment has seen a slight change as it has gone up to 3.7 percent from 3.6 percent in May. Despite this marginal increase in the unemployment rate, the increased job creation is said to have given the momentum to the US economy.

The US economy added about 172,000 jobs a month on average in the last three months, which was down from 223,000 in the previous year. The addition of 224,000 jobs in June, however, has helped cool off the pressure on the economy.

Establishment Survey Data

Notable job gains were made in professional and business services, health care, and transportation and warehousing. The professional and business services added over 51,000 jobs for the month of June, which is one of the top performers of the month. 

The average employment growth in professional and business services is 35,000 a week in 2018 and the month of May saw a meager increase of 24,000. However, the increase in June has been remarkable as it also went above the employment growth of 2018, which was 47,000.

The health care sector added 35,000 jobs in June, in which ambulatory health care services and hospitals added the most number of jobs – 19,000 and 11,000 jobs respectively. The construction sector (+21,000), manufacturing (+17,000), transportation and warehousing (24,000) have also added a significant number of jobs in June.

The average hourly wage earnings for all employees increased by 6 cents, following the 9-cent increase in May. Over the last 12 months, hourly earnings of employees have increased by 3.1 percent.

Household Survey Data

The employment status of the major workers’ groups has seen little changes from the month of May. The unemployment rate of the major workers’ groups for the month of June is as follows:

Workers Groups Unemployment Rates
Adult Men 3.3 percent
Adult Women 3.3 percent
Teenagers 12.7 percent
White population 3.3 percent
Black population 6.0 percent
Hispanic population 4.3 percent
Asian population 2.1 percent

The labor force participation rate was at 62.9 percent, which witnessed little change from the month of May. The employment-population ratio remained unchanged at 60.6 percent for the fourth month in a row.

Final Analysis

The increase in the number of jobs for the month of June has alleviated eased the pressure on the United States’ economy. The slow growth of the job market in May had raised questions on the health of the economy, and on the future course to be taken to stabilize the economy.

The positive figures presented in June has given a breathing space for the policymakers and has also given an impetus to workers and job-seekers as the rate job-creation and the average weekly wages have increased.  


The employment situation for the month of May has steadfastly maintained the growth achieved in the month of April. The unemployment rate has remained at 3.6 percent, which still remains to be the lowest rate in the last 50 years. The month of May will be the record 15th month to witness the rate of unemployment grow under 4 percent.

Establishment Survey Data

The professional and business services and healthcare companies have added more jobs than other sectors in May. The two sectors have added 33,000 jobs and 16,000 jobs respectively. However, there has been a substantial fall in job growth in these sectors when compared to the previous month. The professional and business services added 76,000 jobs and the healthcare sector added 27,000 in the month of April.

The reduction in job growth is not newly encountered in the month of May as this phenomenon has been observed since the month of March. The US just added an overall of 75,000 jobs in the month of May, which is significantly lesser than 224,000 jobs added in April. The average job growth has come down to 151,000 in the last three months (March, April, and May) against the average of 196,000 in the last 12 months.

This trend of reducing job growth, in spite of the unchanged unemployment rate, is worrisome due to the ongoing global trade disputes, particularly between the US and China. The heat is particularly felt by the construction and manufacturing companies. Employment in construction companies saw a small improvement of 4000, whereas the industry added over 30,000 new workers in April.

Manufacturing companies, along with mining, retail trade, retail trade, transportation, and warehousing companies witnessed a very small change in job growth in May. Along with the reducing job growth rates, another important indicator that is pointing towards the sensitivity of nature of the economy was the ISM Manufacturing Index.

The ISM Manufacturing Index is considered as one of the most important indicators of recent US economic activities. The Index showed that the economic activity in the month of May was at the lowest level in the last three years. This indicates another warning to the strength of the factory sector.

Household Survey Data

The status of the labor force has seen little to no change in the month of May, as compared to the month of April. The status of the major worker’s groups for May are as follows:

Workers Groups Unemployment Rates
Adult Men 3.3 percent
Adult Women 3.2 percent
Teenagers 12.7 percent
White population 3.3 percent
Black Population 6.2 percent
Hispanic population 4.2 percent
Asian population 2.5 percent

The month of May witnessed a marginal increase in the rate of persons unemployed less than 5 weeks and persons who are long-term unemployed. Persons unemployed less than 5 weeks increased by 243,000 to 2.1 million, whereas the long-term unemployed stood at 1.3 million.

The labor force participation rate and employment-population ratio both remained unchanged from the month of April, as both stood at 62.8 percent and 60.6 percent respectively.

Final Analysis

The trends displayed in the month of May may ring a bell of caution to the policy-making fraternity of the United States. The reducing job growth rate and the not-so-promising ISM Manufacturing Index results for this month indicates that there might be some challenges up ahead to contain the reduction of job growth rate.

Although the overall rate of unemployment stands at a record low as of May, there is a need to take steps to increase the rate of job growth to achieve sustainable growth.

The rate of unemployment in the United States reached a record low by the end of April, which is said to have the lowest rate of unemployment in the last 50 years. The unemployment rate dropped to 3.6%, and the month of April will be the 14th consecutive month to record an unemployment rate below 4 percent. While the drop in the rate of unemployment appears to be a good sign for the economy on the outset, this statistic alone does not show the entire picture.

The Employment Situation Report for the month of April suggested that the US economy added no less than 263,000 jobs in the month of April. Along with the decline in the rate of unemployment, the United States economy has also witnessed another highly encouraging development.

The wage growth in the last nine continuous months has been over 3%, with the month of April recording a rise in the wage rate by 3.2%. The United States economy has witnessed the wage rate growth in such continuity for the first time since the great recession of 2008-09.

As the United States enter into a positive time-period with respect to the growth of employment rate, the government still have a major concern to address. The concern being, the 3.6% unemployment rate does not completely encapsulate the actual state of the matters on the grassroots level.

The official unemployment rate only includes those in the ‘labor force’. To remain in the labor force, the requirement is that one must have looked for an employment opportunity in the last four weeks.

The real unemployment rate, as opposed to the official unemployment rate, also includes the underemployed, the marginally attached, and discouraged workers. As a result, the real employment rate is considered to be more comprehensive as it represents a larger set of people who are at the bottom of the labor market.

The rate of real unemployment in the US is 7.3% for the month of April. Also, the reduction in the main unemployment rate is coincided with a decline in the labor force participation by 0.2 percentage point, which currently stands at 62.8%.

The records show that the share of people working or actively looking for work has seen a bare minimum change in the last seven years. This shows that aspects such as job mobility, combined with mediocre wage rate growth is not helping the employees grow in reality.

To counter this and provide a more organic environment for the employees and the employers, the government must come up with a comprehensive job creation strategy. The government must also cater to those who are not in the ‘labor force’, along with those who are currently seeking a job to see more sustainable growth in the economy of the United States.

The United States already gives importance to the start-ups to make sure that more and more people get opportunities. Start-ups are also said to produce a large number of jobs due to the sheer number of new ventures that come out every year. The successive governments over the years have spent a lot of amount of money to provide an organic infrastructure to help start-ups to prosper.

The issue here is that, in spite of the investment and support, nearly 75% of the start-ups fail in the early years. Also, Startups that have less than 20 employees generally have a negligible effect on net job creation until they pass the 5-year period.  

The government must diversify its policy programs beyond the start-ups, which is currently given high importance with respect to job creation. Sectors such as manufacturing, construction, and health care have been steadily increasing the intake of people. Governments providing incentives to these industries to create more jobs will help in creating more stable jobs. This may help in bringing down the number of underemployed and marginally attached workers.

There is a need for the government of the US to diversify its purview beyond the start-ups and look to provide incentives for high-impact companies that are locally based to accelerate the next level of growth.