The labor force is a key indicator of economic health, and it is the sum of employed and unemployed individuals. The unemployment rate is calculated by dividing the number of unemployed people by the total labor force. To be considered employed, an individual must have worked at least one hour as an employee or in their own business during the week, including the twelfth day of the month. The labor force does not include those who are not actively looking for work, such as students and retirees.
The full-time labor force is composed of full-time employees and the unemployed, while the part-time labor force includes part-time employees and the unemployed. The unemployment rate for full and part-time workers is calculated using full and part-time labor force levels as a denominator. Discouraged workers are a subgroup of people with a marginal attachment to the workforce and are also part of the larger group of people who are not part of the workforce. These individuals want a job but are not currently looking for one.
The Bureau of Labor Statistics (BLS) publishes a number of alternative labor underutilization measures in addition to the official unemployment rate. Marginally attached workers are a subgroup of those who are not part of the workforce and who currently want a job. The long-term unemployed are those who meet the definition of unemployed in the Current Population Survey and whose unemployment has lasted 27 continuous weeks or longer. The labor force participation rate is the proportion of people aged 16 and over who are classified as employed or unemployed, as defined by BLS.
The unemployment rate represents the number of unemployed people as a percentage of the labor force. The BLS also measures labor force participation rate based on a monthly household survey conducted by them. With an aging population, lower labor force participation rates, and declining population growth rates, the labor force will grow more slowly than in recent decades. It does not include those who are in the military, in prisons, or who are outside the ordinary labor market.