Via CNS News: The CBO defines “full employment” to be when the national unemployment rate is at or below what it calls the “natural unemployment rate.”
The natural unemployment rate, according to CBO, is the “rate of unemployment arising from all sources except fluctuations in aggregate demand. Those sources include frictional unemployment, which is associated with normal turnover of jobs, and structural unemployment, which includes unemployment caused by mismatches between the skills of available workers and the skills necessary to fill vacant positions and unemployment caused when wages exceed their market-clearing levels because of institutional factors, such as legal minimum wages, the presence of unions, social conventions, or wage-setting practices by employers that are intended to increase workers’ morale and effort.”
The Congressional Budget Office (CBO) projects that it will take at least four more years to get back to "close to full employment, as defined by the CBO.
In fact, baseline data CBO released last month indicate that the “natural unemployment rate” will be 5.5 percent through the rest of Obama’s presidency and that actual unemployment will never drop below 6.0 percent in any quarter between now and the end of 2016.
According to CBO, unemployment will remain above 7.0 percent through the third quarter of 2015. It will then drop to 6.8 percent in the fourth quarter of 2015, and gradually decline to 6.0 percent by the fourth quarter of 2016.
If the CBO's projections are correct or even optimistic, that would make Barack Obama the only president during the post-World War II era to have never presided over a single year in which the U.S. economy offered full employment to the American people.
This is despite the fact that the CBO increased what they consider to be the "natural unemployment" rate during Obama's term.
From 1999 through the first quarter of 2008, the CBO calculated natural unemployment to be at 5.0 percent, now under Obama increased to 5.5 percent.
To see a complete list of the average actual annual unemployment rates compared to the natural unemployment rate for the years from 1988 onward click here.