Chart: What's the real unemployment rate?

The Labor Department said Friday that the unemployment rate dropped to 5 percent in October this year — but does that tell the whole story?

Most economists look beyond the "main" unemployment number to other metrics that can give a more textured view of the employment situation. On jobs day, the Bureau of Labor Statistics puts out a slew of figures, each of which provide their own view of the economy.

One of those figures in the U-6 rate. Many economists prefer the U-6 rather than the main unemployment number (also known as the U-3) because it captures people who work part time but would like to be working full time but can't.

The BLS defines U-6 as "total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all marginally attached to the labor force."

In other words, the unemployed, the under employed and the discouraged — a rate that has seen gains but still remains above prerecession levels.

The U-6 rate dropped two tenths of a percent in October to 9.8 percent. The overall trend in the U-6 has been more volatile than the main unemployment rate: It's down 170 basis points over the past year, compared to a 70-basis-point drop in the U-3.

Economists and Wall Street are watching this jobs report especially closely as we approach the December Fed meeting. Fed Chair Janet Yellen has stressed the importance of improved economic indicators before they raise interest rates and has hinted that a raise is likely by the end of the year.

"Now no decision has been made on that and, what it will depend on, is the [Federal Open Market Committee's] assessment at the time," she told the House Financial Services Committee Wednesday. "That assessment will be informed by all of the data that we collect between now and then."

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Yellen has said that policymakers were waiting to see an increase in the labor participation rate as well as a decline in unemployment.

Another measure of the labor market used by economists is the ratio of vacancies posted (v) and the number of unemployed (u). This v/u ratio measures labor market tightness; a rising indicator means more businesses are looking to fill positions relative to the number of job seekers.

By this indicator, the labor market is very close to reaching prerecession levels of tightness.

The nation added 271,000 nonfarm jobs in October.

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