U-6, labor force participation, the poverty rate, and the New One Percent

28 Sep

I was just questioning the affordability of Cal Water’s proposed rate increase, here:


Since then I’ve been seeing more evidence that NONE of California can afford to foot the bill for Cal Water’s champagne lifestyle anymore. Read Dan Walters, here, in the Sac Bee, published just the other day.


Walters is talking about our “true unemployment rate” or U-6, “which counts not only workers who are officially unemployed, but those ‘marginally attached’ to the labor force and those involuntarily working part-time.”

In Chico, for example, we have hundreds of part-time CARD workers, who by a decision of the board, were cut to 28 hours or less so that CARD would not have to pay Obamacare on these people. Meanwhile, roughly 33 CARD management employees enjoy fully paid packages running as much as $23,000  a year and full retirement at age 55 – for which they pay nothing. 

Walters reports, “Our U-6 rate is 14 percent, down a bit from the recession but still the nation’s second-highest, topped only by Nevada’s 15.2 percent.”

And here’s something I had never heard before – Walters compares our unemployment figure with our employment figure – the “labor force participation rate”. 

“Finally, the true employment picture is affected by the “labor force participation rate,” the percentage of those in the prime working age group (16-64) working or seeking work. Ours is 62.3 percent, the lowest level in 40 years.”

So, “When more than a third of potential workers sit on the sidelines, the official unemployment rate, or even U-6, look much better than they truly are. The true underemployment rate may be closer to 20 percent.”

That sounds more like Chico to me, where most of the people I know are not as employed as they would like to be – construction workers who are not getting 40 hours a week even in this supposed “building boom” we’ve been hearing about, salespeople who are not making enough sales to earn a living, retail workers who are held to less than 30 hours a week because their boss, like CARD, can’t afford Obamacare. 

I talked about the poverty rate in Chico in a recent blog – that’s people living below the poverty level ($24,000/year for a family of four). Chico’s poverty rate is higher that California – 23% compared to 17% statewide. That’s according to


Statistics are tough – we aren’t counting all those street people, this is information given by households to the Census Bureau. “Household” meaning a group living under one roof. We also have the State Franchise Tax Board, the IRS, the Social Service administration and the welfare agencies. According to all those people, Chico is poor by state standards, even with all those public salaries over $100,000/year – it takes a lot of poor people to balance out Mike Ramsey and Mark Orme. 

So, we’re poor for California – according to Walters, California is poor by national standards.

Back to the poverty rate. It’s not only higher than the national rate, but as the California Budget and Policy Center points out, the data indicate that 22.7 percent of the state’s children are living in poverty, and they are nearly a third of all officially impoverished Californians.

As dark as that situation may sound, it’s actually worse. By the Census Bureau’s supplemental poverty measure, which uses broader factors including the cost of living – especially housing – 23.4 percent of Californians are impoverished.

Those data are bolstered by two other factoids. Nearly a third of California’s 39 million residents are enrolled in Medi-Cal, the federal-state health care program for the poor, and nearly 60 percent of K-12 students qualify for reduced-price or free lunches due to low family incomes.

According to the Census Bureau, a lot of Chicoans have no healthcare insurance, more than the state average, so yeah, we have a lot of people who are eligible/enrolled in Medi-Cal. 

I found another “factoid” site when I was looking at all these figures, the California Employment Development Department:


Above you will find the “High Wage Occupations” in Chico. Are you surprised to find it is mostly doctors and other medical professionals? Of course not, that’s come up before – doctors are the highest tier of the new One Percent who own most of the wealth in America, followed by professional athletes.

Are you surprised to find “Chief Executives” at Number Four in Chico? That includes public and private enterprises. In Butte County as well as Chico, I will throw out a guess – most of these positions are in the public sector, Dave Little just ran an editorial about it.

I would also include the “quasi-public” sector – the utility companies, like Cal Water and PG&E. Cal Water management pay nothing toward their benefits and pension, I haven’t been able  to find out about PG&E. 

The One Percent, vs the Ninety-Nine Percent who are too stupid to get it? 


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