Counting More Than Jobs: Rethinking Veteran Unemployment

September 8, 2025

For Immediate Release

_The Ludwig Institute for Shared Economic Prosperity’s (LISEP) True Rate of Unemployment (TRU) offers an expanded assessment. The TRU identifies workers as functionally unemployed if they are jobless, working part-time but want full-time hours, or earning less than $25,000 annually (in January 2024 dollars). Applying this broader measure to veterans reveals a more comprehensive and complex employment landscape.

Figure 1: True Rate of Unemployment (TRU) vs. Bureau of Labor Statistics U-3 Unemployment Rate: Veterans

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The official BLS unemployment rate for veterans has hovered between 2–5% for much of the last six years. In contrast, LISEP’s TRU indicates that functional unemployment among veterans is consistently and substantially higher, generally falling within the 15–20% range. For example, in the first quarter of 2025, the BLS reported a 4.0% unemployment rate for veterans, while the TRU stood at 18.2%, a figure more than four times greater. Put another way, for every veteran counted as unemployed by the BLS, at least three more are functionally unemployed. This gap underscores that many veterans classified as “employed” under the official definition are in jobs that do not provide economic stability or a living wage.

The divergence is not a statistical anomaly but a systemic flaw in how we perceive veteran well-being. It underscores that for many who have served, the challenge isn't just finding a job but finding a good job—one that offers sustainable income and sufficient hours.

However, the TRU, which focuses on those within the labor force, does not fully capture the extent of economic disconnection. It excludes veterans who are no longer actively seeking employment and are thus outside traditional labor force calculations.

LISEP’s True Rate of Unemployment Out of the Population (TRU OOP) addresses this by accounting for all adults, including those who have left the labor force entirely. This measure provides insight into the overall extent of economic disconnection.

Figure 2: True Rate of Unemployment Out of the Population (TRU OOP) vs. Bureau of Labor Statistics U-3 Unemployment Rate Out of the Population: Veterans

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The data indicates that veterans’ TRU OOP has remained persistently high, fluctuating between 60% and 65% since 2019. Meanwhile, the BLS’ unemployment out the population rate has generally fluctuated between 52% and 55% since 2019.

The consistent gap between official BLS unemployment figures and LISEP's TRU and TRU OOP data highlights a critical divergence in how veteran economic well-being is typically understood. While the conventional unemployment rate suggests a smooth transition for many who have served, the TRU reveals a more nuanced picture of underemployment and insufficient wages within the veteran labor force. Furthermore, the consistently high TRU OOP for veterans’ points to a significant proportion of this population that remains outside the labor force entirely.

Ultimately, these combined measures suggest that relying solely on traditional unemployment metrics provides an incomplete and potentially misleading assessment of veteran economic stability. A more comprehensive understanding requires acknowledging both the quality of employment for those actively in the workforce and the significant segment of veterans whose economic circumstances are not reflected in conventional statistics.

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To delve deeper into these calculations, explore our data and methodology.

Additional Resources

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To delve deeper into these calculations, explore our data and methodology.