Most people think they know what it means to be technically unemployed. The reason for the term "technically" is because no matter what one person may think of as far as unemployment, your government may have a totally different idea and definition. Therefore, if you're currently not working and wonder if you are considered unemployed then you might want to read this technical overview of just what it is that makes a person unemployed.

The reason to even go into this argument is because many people look at unemployment figures and think to themselves, "7% unemployment? That's not too bad." Well, maybe it's not, based on previous numbers, but it's not a true reflection of how many people are out of work, because out of work doesn't mean unemployed.

Confused? You won't be.

To start with, let's say you're fresh out of high school, decide you don't want to go to college and instead want to go out in the world and make a living. You start looking through the papers for a job. Are you unemployed? Well, you're out of work, but you're not unemployed. Huh? Well, it's like this. Since you never had a job in the first place you didn't have a job to lose, which is what unemployment figures show. So technically, you're not unemployed. This makes sense, otherwise every kid out of high school would be hitting the unemployment office.

Okay, so you finally find a job out of high school but lose it after one day. Are you unemployed now? No, still not. You haven't been working long enough. For starters, you haven't even made a pay check so you don't qualify for benefits, plus you don't have enough of an employment history to qualify for unemployment. So technically, you're still not unemployed. Out of work, yes. Unemployed, no.

Finally, you get a job and keep it for a whole year. You lose your job for whatever reason. You are now unemployed and can apply for unemployment benefits, which come out to a percentage of the money you made, up to a maximum amount. Yes, there is a cap. So even if you were a CEO making six figures a year, your unemployment benefits may be capped at as little as $500 a week. Unemployment is a real killer for CEOs.

So now that you're unemployed you remain unemployed until you find another job. Right? Well, not quite. Unfortunately, unemployment doesn't last forever even if your out of work status does. Unemployment benefits, depending on the jurisdiction, can be anywhere from six months to a year. After that, you can apply for extended benefits, but eventually there comes a time when even if you don't have a job you are not officially counted in the unemployment statistics unless you are registered with an employment agency and actively looking for work. If you reach a point where you say the heck with it because you can't find work and drop out of the work force, you are considered a discouraged worker but not counted in the unemployment statistics.

So the next time you hear the latest unemployment statistics just remember that there are a lot of unhappy people who are not a part of that figure.

Michael Russell
Your Independent guide to Unemployment