How the Wall Street Journal Got It Right on Underemployment

The reflection of economic pain is much higher than "the number of underemployed ... rising much faster than during previous recessions ... the average workweek has fallen to 33 hours, the lowest level in the post-World War II period ... These data suggest that the excess supply of labor is even greater than indicated by the unemployment rate alone," said Federal Reserve Chairman Ben Bernanke is quoted as saying in a speech to the Economic Club of New York. "The unemployment rate is now 10.2%"

Elsewhere, official unemployment levels are higher than New York's: Michigan's rate has recently dropped to 14.3%. Dugan explains the shocks of current high unemployment because "the recession" has been going on much longer in some places. Unemployment figures cannot accurately reflect the drastic change of income some re-employed persons receive. These re-employed workers are unlikely to see pre-recession income levels any time soon.

Everyone knows people who have lost their jobs and taken interim work to make do: former financial services executives who now work at FedEx (FDX),a company that reports it is in the best shape of its life; real estate and mortgage professionals who work as cashiers in the local grocery; recruiting consultants at work as temporary secretaries .The questions The Wall Street Journal asks are tough: Are the jobs being taken by the under-employed the new "normal"? Will these professionals manage to return to pre-recession levels of income, when their developed skills (relevant to a particular industry and not easily transferable to another) atrophy more each month?

The Wall Street Journal continues: "Federal figures on the underemployed, however, don't count that second group -- those who are overqualified for their jobs. Still, the government's broadest measure of labor underutilization -- known as the U6 -- has more than doubled in the two years since the recession began, up from 12% just a year ago to 17.5%, according to the Bureau of Labor Statistics. This means that nearly one in five people are either unemployed, involuntarily working part-time or "marginally attached" -- they want jobs but haven't searched in at least a month. It also counts "discouraged workers" who have stopped searching. "The number would be much higher if we included the mechanical engineers working at 7-Eleven," says Heidi Shierholz, who studies underemployment at the Economic Policy Institute, a left-leaning Washington think tank.

The Wall Street Journal got this one right.

Editor's Note: This column was contributed to BloggingStocks via Seed.com, AOL's online platform for freelance writers.