Technical
Labor
and
Force,
Note
Employment,
Unemployment,
Estimating
Methods
1929-39:
1
Estimates of the total labor force,employment,
and unemploymentin 1929-39, which were prepared by the Bureau of Labor Statistics several
years ago in order to fill a gap in the official
statistics,have been revisedrecently. These were
designed for comparability with the monthly
series issued by the Bureau of the Census beginningin 1940, and togetherthese series provide
a continuous set of estimates from1929 to date.
A wide variety of estimates of labor force and
unemploymenthad previously been prepared by
private agencies and individuals. These statistics
were of considerable value in informingthe public
about the gravity of the unemploymentsituation
in the 1930's.
In 1945, the BLS developed and made available
preliminaryestimates of labor force,employment,
and unemploymentfor the 1929-39 period, comparable with those then published by the Bureau
of the Census in its Monthly Report of the Labor
Force (MRLF).
Subsequently, the Census Bureau published revised estimates for 1940-45,
incorporatingadjustments resulting from an improvement in interviewingprocedure, introduced
in July 1945. Corresponding adjustments have
now been made in the BLS estimates.
The methods used by the BLS in developing its
estimates of labor force,employment,and unemploymentare discussed in the present article, and
a comparison is made with earlier series.
i Prepared
oftheBureau's
Division
of
byStanley
Lebergott,
formerly
andOccupational
Outlook.
Lester
Employment
Pearlman,
Sophia
Cooper,
Harold
andother
staff
inthedevelopment
members
of
Wool,
cooperated
theestimates.
Valuable
advice
wasalsoreceived
from
members
ofthe
Bureau's
Technical
onLabor
Committee
and
Budget
Supply,
Employment,
Statistics.
Unemployment
50
Total Labor Force
To estimate the total labor force for the years
between 1929 and 1940 it was necessary (a) to
establish comparable Census bench-markfigures
for1930 and 1940, (b) to interpolatebetween these
bench-markfiguresand extend them back to 1929.
Estimates of the labor forcein the Census week
of 1940 (March 24-30) that are comparable with
the currentestimatesof the MRLF, have recently
been published by the Bureau of the Census.2
Estimates for the comparable week of 1930, were
computed afteradjustment forthe change in labor
force definitionsbetween the 1930 and 1940 Censuses8 and for the effectsof the improvementin
interviewingprocedureintroducedinto the MRLF
in July 1945.4 The workerrates (i. e., the percentage of the population in each age-sex group who
were in the labor force) were then computed for
the bench-markperiods in 1930 and 1940.6
The labor forceestimatesfor 1929 and 1931-39,
on an April seasonal level, were calculated by (1)
interpolating linearly, between the worker rates
for 1930 and 1940, and (2) applying the resultant
rates to Census estimatesof population by age and
1See:United
States
Bureau
oftheCensus,
Labor
and
Force,
Employment
intheUnited
1040
to1046,
Series
No.2.
Unemployment
States,
P-50,
*The1030
included
Census
as"gainful
workers"
seasonal
workers
who
were
notactually
atwork
orlooking
for
work
theCensus
aswell
as
week,
during
and
some
retired
inmates
of
who
could
persons
institutions, nothavebeen
inthe"labor
included
force"
asdefined
inthe1040
Census.
Ontheother
the1030
Census
excluded
who
were
for
hand,
young
persons
actually
looking
work
buthadnotyet
a gainful
established
Arevision
oíthe1030
occupation.
toallow
estimates
for
andother
these
in:United
differences
States
appears
Bureau
ofTheCensus,
Estimates
ofLabor
andUnemForce,
Employment
intheUnited
1040
and1030
ployment
States,
(1044).
«Theadjustment
for
with
1040
therevised
Census
comparability
estimates,
inCensus
asshown
release
Series
No.2(1046)
wasmade
P-50,
bycomputing
oftherevised
theratios
tounrevised
1040
Census
estimates
for
each
sex,
age,
andemployment
status
andapplying
ratios
these
tothecorresponding
group,
in1030.
groups
1Although
inthepresent
instance
worker
rates
for
were
age-sex
groups
calculations
alsohavebeen
made
toallow
theeffects
ofthe
for
used,
might
racial
ofthepopulation.
Tests
changing
composition
indicated,
however,
thatsucha refinement
would
nosignificant
inthefinal
produce
change
estimate.
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LABOR FORCE- ESTIMATINGMETHODS
sex foreach year.® The labor force estimates for
1929-39 were then adjusted to an annual average
basis by use of a seasonal adjustment factor derived fromthe month-to-month
movementshown
in the MRLF since 1940.7
In table 1, a sharp contrastis apparent between
the gradual increase in the labor force shown for
the years 1929-39 and the marked fluctuations
reportedsince 1940 by the Bureau of the Census.
This reflectsin part the unprecedentedexpansion
of the labor forceunder wartimepressuresand the
subsequent contraction. In part, however, it
arises because the full extent of variations in the
labor force cannot be determined precisely for
those years priorto 1940 when no direct enumerations of the labor forcewere made.
51
Armed Forces
Estimates of the net strengthof the armed forces
prior to 1940 were obtained by the BLS directly
fromthe armed services. The estimates as shown
(in table 1) differslightlyfromthose used in the
MRLF beginning in 1940. The Census Bureau
currentlyexcludes from its estimate of the total
labor force about 150,000 members of the armed
forces who were stationed outside of the continental United States in March 1940 and who were
thereforenot enumerated in the Census of that
date. This group is, however, included in the
BLS estimates.
Employment
Table 1.- Totallaborforce,
status,
byemployment
classified
1929-1H71
inthousands]
[Annual
averages,
The estimatesof total employmentrepresentthe
sum of: (1) nonagriculturalemployees (i. e., wage
and salary workers), (2) nonagricultural selfemployed, unpaid family workers,and domestic
Civilian
labor
force
service workers,and (3) agriculturalemployment.
Employed
Estimates of nonagricultural employees were
TotalArmed
Year
labor forces
based on the movement of the recently revised
„Total
, «?•
BLS series of employees in nonagricultural
cul- St «55
tÄ
establishments.8 This series was adjusted to the
_
bench-mark
totals of nonagricultural employees
1029
49,440 260 49,18047,63010,45037,180 1,550
193 0
50,080 260 49,82045,48010,34035,140 4,340 in 1930 and 1940, as estimated fromthe Census
193 1
50,680 260 50,42042,40010,29032,110 8,020
193 2
51,250 250 51,00038,94010,17028,77012.060 data.9
193 3
51,840 250 51,59038,76010.09028,67012,830
193 4
52,490 260 52,23040,8909,90030,99011,340
The estimates of the nonagricultural self193 5
53,140 270 52,87042,26010,11032,15010,610
193 6
300 53,44044,41010,00034,410 9,030 employed were developed for the present series.
53,740
193 7
54,320 320 54,00046,3009,82036,480 7,700
193 8
54,950 340 54,61044,2209,69034,53010,390 The general procedure was to develop ratios of
193 9
55,600 370 55,23045,7509,61036.140 9,480
194 0
56,180 540 55,64047,5209,54037,980 8,120 self-employed persons per employee separately
194 1
57,5301,62055,91050,3509,10041,250 5,560
194 2
60,3803,97056,41053,7509,25044,500 2,660 for each industry group and each year. These
1943.64,560
9,02055,54054,4709,08045,390 1,070
194 4
66,04011,41054,63053,9608,95045,010 670 were then applied to the correspondingestimates
194 5
65,290
53,86052,8208,58044,240 1,040
11,430
194 6
60,9703,45057,52055,2508,32046,930 2,270 of employees. For those years between 1929 and
194 7
61,7601,59060,17058,0308,26049,770 2,140
1939 when Censuses of Manufactures, Business,
>Estimates
for
theperiod
1929-39
were
theBureau
ofLabor and Construction were available, the ratios were
prepared
by
Statistics.
for
Estimates
theperiod
1940-47
were
from
U. S.Bureau
adapted
of
Labor
Force
Series
No.2.
Census,
Bulletin,
P-50,
1the
Total
labor
force
includes
civilian
labor
force
andthearmed
forces.
The computed from the Census data. For interestimates
oftotal
labor
force
andofthearmed
forces
wore
adjusted
upward
toinclude
about
members
ofthearmed
forces
stationed
outside
the censal years, the ratios were computed on the
150,000
continental
United
inMarch
States
andwhowere
notenumerated
in
1940,
of the relationshipbetween (1) the ratios for
ofthat
theCensus
date.TheCensus
Bureau
reduces
itscurrent
estimates basis
ofthetotal
labor
force
number
inorder
this
tomaintain
by
comparability
Census
years and (2) the number of employees
with
the1940
Census.
*Population
8Thisseries
estimates
usedwere
Census
ofthepopulation
estimates
for
intheMonthly
waspresented
Labor
Review
for
December
aspublished
inCensus
release
Series
No.5.
July
1,ofeach
year,
1947
P-45,
647).
(p.
*Afinal
wasmade
within
toinclude
thetotal
labor
force
mem- *Bench
mark
estimates
ofnonagricultural
adjustment
for
1930
that
employees
April
benofthearmed
forces
stationed
ofthecontinental
outside
United
States were
with
thecurrent
MRLFestimates
were
incocomparable
prepared
andwhowere,
notintheCensus
basefigures
for
either
1930
or operation
with
theBureau
oftheCensus.
therefore,
These
were
then
to
adjusted
1940.
There
were
about
members
ofthearmed
services
stationed annual
onthebasis
ofmonthly
levels
150,000
dataoftheBLS.
average
employment
outside
ofthecontinental
inMarch
United
States
andabout
1940
0C0 Estimates
ontherevised
for
1940
were
based
data
Census
inCensus
130,
published
in1930.
No.2fandonunpublished
release
Census
estimates.
P-50,
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52
LABOR FORCE- ESTIMATINGMETHODS
in the appropriate industry group for the same
year.10
Agriculturalemployment(includingfamilyand
hired workers) was estimated on the basis of the
movement of the series of the Bureau of Agricultural Economics, and adjusted to annual average
employment in 1930 and 1940, by the use of
Census data.11
Unemployment
MONTHLYLABOR
from a prosperitylow in 1929, to peak levels in
1932 or 1933. After 1933, the movementsof the
respectiveserieswere also generallysimilar. However, a more detailed examination reveals significantdifferencesin level, as well as in year-tovear movement.
Table 2.- Selectedestimatesof unemployment
in the
UnitedStates1929-89
[Inthousands]
But
Mil Alex" Amer-Congress
trial Robert
Unemploymentestimates may be computed (1)
Y„r
oftri2,USNathaa
ton Ä'
(ÄC°n£rby direct enumerationof the unemployed, or (2)
Labor zationsBoard
Institute
by deductingthe total of those actually employed
fromthe total available forwork (the labor force).
1929.
1,550 3,456 1,864 1,831 429 1,752v
4,340 6,929 4,735 4,710 2,896 4,646
The method of direct enumeration is currently 19301931
8,020 10,939 8,568 8,322 7,037 8,118
1932 .
12,060 14,728 12,870 12,120 11,385 11,639
utilized in the sample surveys of the MBJLF. It
1933 .
12,830 14,394 13,271 12,643 11,842 11,942
1934.
11,340 12,419 11,424 10,845 9,761 9,998
was also employed in the Population Censuses of
1935 .
10,610 11,629 10,652 10,050 9,092 9,102
1936
.
9,030 10,008 9,395 8,756 7,386 7,723
1930 and 1940. But for those years in which no
1937.
7,700 8,366 8,282 8,109 6,403 6,856
1938
10,390
11,934 10,836 11,030 9,796 9,865
national enumerationswere made, including 1929
1939.
9,480 10,696 9,979 10,813 8,786 9,835
and 1931-39, it was necessary to use the second
ofthenongovernmental
Institute:
Alexander
Hamilton
Sources
estimates:
ofLabor:
Ameriwith
American
Federation
theinstitute.
method, and to estimate unemploymentby subcorrespondence
1941
ofIndustrial
can
Federationist,
25).
August
(p.
Organizations:
Congress
total
from
the
labor
total
Bulleof
March
Robert
Nathan:
Social
1941.
tracting
figures
Security
employment
unpublished
1940
andsubsequent
dates.National
Industrial
Conference
tin,January
force.12
Board:
Almanac
for
Economic
1948,
(pp.269,
270).
As shown in table 2 the present unemployment
There are five major reasons for the differseries differsfromprevious estimatesof unemployences shown between the BLS series and earlier
ment for 1929-39, although the general pattern
estimates.
is not far different.18All of the series cited, for
(1) The population data utilized in previous
example, show the steep rise in unemployment estimates were in
general less accurate than the
" Thisprocedure
isillustrated
ofestimating
thenumber
of officialBureau of the Census estimates employed
bythemethod
inretail
trade.
Thenumber
ofemployees
self-employed
persons
perpropinretail
rietor
trade
wasdetermined
for
Census
from
thecensuses
of in the present computations. The latter were
years
retail
trade.
These
ratios
from
a lowof2.367
inthedepression
of based on data not available until recentyears.
ranged
year
1933
toa high
in1929,
of2.988
with
intermediate
values
for
and1939.
1935
Theratio
with
thegeneral
level
ofretail
trade.
Itwasthus
changed
(2) In previous unemploymentseries, the estipossible
tocompute
coefficients
which
from
estimates
oftheratios
for
the mate of the labor forcewas made in termsof the
regression
were
derived.
these
latios
ofemployees
years
intervening
Bydividing
per
into
thetotal
number
ofemployees,
estimates
obtained
were
of 1930 Census concept of "gainful workers"- a
proprietor
themovement
ofself-employed
inretail
trade
over
theperiod.
This"move- concept which is not comparable to that used in
ment
series"
wasthen
tothebench-mark
total
and
ofself-employed
adjusted
own-account
workers
derived
from
the1940
Census
tothe the 1940 Census and in the MRLF. Furthermore,
(after
adjustment
MRLFlevel)
revised
toyield
theestimates
inretail certain of the previous estimatesmade inadequate
oftotal
self-employed
in1929-39.
trade
» FortheCensus
week
of1930
a separate
estimate
ofagricultural
employ- allowance forthe fact that the numberof workers
ment
wasprepared
inconcept
with
that
ofthe1940
Census.
This relative to the population does not remain concomparable
wasthen
toanannual
level
onthebasis
ofthemonthly
figure
adjusted
average
dataoftheBAE,after
for
inseasonal
differences
movement
between stant. Sufficientadjustment was not made for
allowing
thelatter
andthat
series
oftheMRLFfor
since
1940.
years
the effectsof changes that occurred in the age
" Theresults
oftheCensus
ofPartial
and
Employment,
Unemployment,
in1937
could
notbeusedfor
thepresent
estimates
because
the composition of the population, in school attendOccupations
methods
used
inthis
Census
were
notcomparable
and
with
those
used
in1930
and other factors, as revealed by a comandbecause
thefemale
worker
rates
inthe1937
shown
Census
1940,
appeared ance,
inconsistent
with
those
inallother
shown
data.
available
parison of the 1940 worker rates with those for
" Among
theseries
onunemployment
this
which
were
examined
for
period 1930 and earlier Census years.
were
those
oftheAlexander
Hamilton
theAmerican
Federation
ol
Institute,
Daniel
theCleveland
Trust
ofIndustrial (3) All the earlier unemploymentseries relied
Labor,
Carson,
Co.,theCongress
Theodore
theLabor
Research
AssociOrganizations,
Corrington
Gill,
Kreps,
Robert
theNational
ation.
Industrial
Conference
andthe primarily on BLS data for estimating nonagriNathan,
Board,
National
Research
for
individual
those cultural employment, but, necessarily, none of
League.Estimates
dates,
including
intheCensus
ofUnemployment
for
theNational
Health
for
1937,
Survey
theNewYorkSunandtheDorothy
Krock them could take account of the 1946 revisions in
1935-36,
Thompson-Arthur
the BLS estimates.
estimates
for
were
likewise
reviewed.
1940,
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REVIEW,JULY 1048
LABOR FORCE- ESTIMATINGMETHODS
(4) In many earlier series the number of selfemployed in nonagricultural pursuits was estimated, by and large, on the assumption that the
self-employedvaried in directproportionwith the
number of employees. Other estimators have
treated the entiregroup or large segmentsof it as
a constant. Industrial censuses show that neither
procedure is satisfactory. When business conditions improve, additional employees tend to be
hired at a fasterrate than the rate of increase in
the number of businesses; the pattern is reversed
when conditionsworsen. As a result,the ratio of
employeesto proprietorsin all importantindustry
groups changed continuallyduring the 1930's.
(5) The basic unemploymentbench mark for
previous estimateswas necessarilythe unadjusted
resultsof the 1930 Population Census. In making
its presentestimates,the BLS had the advantage
of both revised 1930 data and materials fromthe
1940 Population Census.
Evaluation of Series
The estimates of labor force,employment,and
unemploymentpresented in this article are based
on a detailed considerationof all available materials, including recent major revisions in Census
and BLS data. However, any labor force and
unemploymentseries which does not rest on a
direct and continuous enumeration is subject to
certaindefects.
- which attaches to any
One such shortcoming
estimates for the years prior to the development
of the MRLF - is the fact that even slight errors
in the estimationof employmentor labor forcemay
produce relativelygreat errorsin the estimates of
of makunemployment. Anotheris the difficulty
53
ing satisfactoryadjustment for changes in worker
rates which arise from changing economic conditions. For example, the participation of women
in the labor marketduringthe depthsof the depression may have been greater than is apparent from
the 1930 and 1940 enumerations. When the head
of the householdwas out ofworkduringthe 1930's,
it was not infrequentthat the housewife in the
family would seek a job. On the other hand,
some young personsremainedin school longerthan
they would have in more prosperous years. The
net effectof these omissions and additions cannot
be measured but it is probably not enough to
change materially either the level or trend of unemploymentfor the years 1929-39.14
The presentunemploymentseries is primarilya
measure of total unemploymentof those persons
who were customarilyin the labor force in terms
of the trends shown by the 1930 and 1940 population censuses. It does not measure the extent
to which the Nation's manpower was not fully
utilized during the depression. Many persons
were employedat part-timejobs. Still otherswere
subject to what has been called disguised unemployment,since they worked at jobs well below
their capacities, and could not provide society
with the optimumuse of theirservices.
Moreover, the labor potential of the population
is greaterthan that indicated by adding unemployment to employment. As the war well demonstrated, many persons not usually in the labor
force take jobs in times of emergency. Such
qualifications as these must be continuallyborne
in mind in using the labor force and unemployment estimates.
" Thisconclusion
isbased
ona special
ofchanging
worker
rates
study
the1930's.
during
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