Economic Insights: US Unemployment Rate

The unemployment rate in the United States currently stands at 3.90%. This is slightly higher than the previous month. In addition, the unemployment rate bottomed out in early-mid 2023 at 3.5%. Since that low, it has crept higher as the Federal Reserve has raised interest rates.

However, per historical metrics, 3.90% is still very low and is considered full employment.

There are signals that the economy is slowing. U-6 unemployment, which are workers that are underemployed has been moving higher for the last year. This has a history of being a leading indicator for recessions.

The Federal Reserve has raised interest rates since the low during Covid in a bid to get inflation under control. To do so, they have been hoping to raise the unemployment rate slight. The concept is that with more jobless, demand for goods will fall and prices will stop rising.

The Federal Funds Rate sits at 5.50-5.75% which is high since the 2008-9 great recession but historically low.

The Unemployment Rate will be released on Friday, June 7th. Expectations are for the unemployment rate to stay the same at 3.9%.