Nearly One-in-Four Workers ‘Functionally Unemployed,’ Says Ludwig Institute

November True Rate of Unemployment shows workers struggling with low hours, wages

December 24, 2025

For Immediate Release

WASHINGTON, D.C. — The percentage of American workers who are ‘functionally unemployed’ continues to hover around the 25% mark with continued signs of weakness in the labor market, according to the latest report from the Ludwig Institute for Shared Economic Prosperity (LISEP).

LISEP’s True Rate of Unemployment (TRU) measures the functionally unemployed, defined as the jobless plus those seeking but unable to find full-time employment, or those earning poverty wages (capped at $26,000 a year in 2025 dollars). Due to the federal government shutdown and the resulting suspension of labor data collection by the U.S. Bureau of Labor Statistics (BLS), no household survey employment data were released for October, and the release of the November TRU was delayed.

LISEP’s TRU was 24.8% for November, down 0.1 percentage points from September, and 0.7 percentage points higher than November 2024. This compares to a federal government jobless rate of 4.6%, the highest level since September 2021.

By demographic, the TRU remains higher for Black and Hispanic workers (28.1% and 27%, respectively) than for White workers, whose TRU was 23.3%. From September to November, the TRU rose by 0.4 percentage points for Black workers, while it fell by 0.5 percentage points for Hispanic workers and declined by 0.3 percentage points for White workers.

Women continue to face worse employment outcomes than men, with the TRU for women increasing 0.3 points to 30.1%. Meanwhile the TRU for men dropped 0.3 percentage points, to 20.2%. In contrast, the unemployment rate for women was 4.5% compared to 4.6% for men in November.

“With the official unemployment rate at its highest level since 2021 and functional unemployment remaining elevated, many households are feeling the effects of a labor market that has grown less forgiving,” said LISEP Chair Gene Ludwig. “Stagnant wages and elevated prices for basic necessities continue to stretch household budgets, pressures that tend to be felt most acutely during the holiday season.”

Additional Resources

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About TRU

LISEP issued the white paper Measuring Better: Development of “True Rate of Unemployment” Data as the Basis for Social and Economic Policy upon announcing the new statistical measure in October 2020. The paper and methodology can be viewed here. LISEP issues TRU one to two weeks following the release of the BLS unemployment report, which occurs on the first Friday of each month. The TRU rate and supporting data are available on the LISEP website at lisep.org/tru.

About LISEP

The Ludwig Institute for Shared Economic Prosperity (LISEP) was created in 2019 by Gene Ludwig and his wife, Dr. Carol Ludwig. The mission of LISEP is to improve the economic well-being of middle- and lower-income Americans through research and education. LISEP’s original economic research includes new indicators for unemployment, earnings, and cost of living. These metrics aim to provide policymakers and the public with a more transparent view of the economic situation of all Americans, particularly low- and middle-income households, compared with misleading headline statistics. On X: @LISEP_org.

About Gene Ludwig

In addition to his role as LISEP chair, Gene Ludwig is the founder of the Promontory family of companies and Canapi LLC, a financial technology venture fund. He is the founder and CEO of Ludwig Advisors, which counsels financial firms on critical matters. Ludwig is the former vice chairman and senior control officer of Bankers Trust New York Corp. and served as the U.S. Comptroller of the Currency from 1993 to 1998. He is also the author of the book The Vanishing American Dream, which investigates the economic challenges facing low- and middle-income Americans. His latest book, The Mismeasurement of America, released in September 2025, is now available wherever books are sold. On X: @geneludwig

Please Note:

The Ludwig Institute for Shared Economic Prosperity continuously revises and updates its data. As a result, data presented in this release may no longer reflect the latest estimates. Find the most current data at lisep.org.