While this week's statistics of 10.2% official unemployment and ~17% total (U6) unemployment are bad news on many different levels, there is another employment statistic that is potentially even more meaningful ...



Yes that's right, average 'full time' working hours for people who still have jobs has fallen to 33 hours per week - a historic low. So what, you ask ?

So what this means is that if and when business levels improve, employers can essentially expand their workforce by 10% without hiring a single additional employee or paying a single additional dollar for health care / retirement / mandated employee benefits ! They can do this simply by adding 3-4 extra hours per week to the schedules of existing workers ... without even having to shell out for overtime pay !

This strongly implies that unemployment levels are not going to improve at all until the US economy experiences at least a 10% improvement ... which at an optimistic 3% economic growth rate will still require 3 years !!! And even that 'rosey' conclusion assumes that the gov't doesn't enact new mandated employer costs which make it more expensive to hire, insure, and provide mandatory employee benefits for a new employee than to pay existing employees overtime pay but avoid having to pay additional costs for new employee benefits !

In equivalent productivity terms, the record low level of average 'full time' working hours means that the ~100 million Americans that still have jobs are each 10% unemployed, technically speaking. This is equivalent to an additional 10 million unemployed Americans if those that still have jobs were actually working an average of 36-37 hours instead of 33.

In terms of consumer spending, this also means that these employees are seeing a reduction in their take-home pay that reflects the reduction in their working hours. This loss of marginal income will of course directly impact 'discretionary' spending levels, reducing the amount of money spent on non-essential items from lap dances to Christmas presents.