The labor force is the sum of employees plus the unemployed, and the unemployment rate is the number of unemployed divided by the number of the labor force. People are considered employees if they work at least one hour as an employee or in their own business at any time of the week, including the twelfth day of the month. Employed people are classified by occupation (what type of work they do) and industry (what type of work is done by your employer or company). The unemployed are classified according to their last job.
See also Earnings by occupation and industry. The labor force is the number of people who have jobs plus the unemployed looking for work. The workforce does not include the unemployed who are not looking for work. Economic policies, such as strong labor market regulation and generous social benefit programs, may also tend to decrease labor force participation.
. This page contains information on labor force data, on the characteristics of employed and unemployed people, and people who are not part of the workforce. The labor force participation rate is an important metric for analyzing employment and unemployment data, since it measures the number of people actively seeking employment, as well as those currently employed. The lack of available jobs during the recession and the resulting slow recovery probably discouraged many people who had been unemployed for more than six months, leading them to stop looking for work (and therefore leave the workforce).
While this report does not unravel the effects of federal fiscal and spending policies on the broader category of economic conditions, the CBO expects that some of those policies will affect labor force participation over the next 10 years by changing the net wage of some people. The labor force participation rate is the labor force as a percentage of the non-institutional civilian population. Changes in the labor force participation rate may distort the importance of the unemployment rate, that is, the proportion of people in the labor force out of work as a measure of the health of the economy. According to the Federal Reserve, the proportion of people of working age (25 to 54 years old) in the labor force peaked at 72% in 1995 and declined to 63.7% over the next 25 years.
For example, the earned income tax credit substantially increases the labor force participation of single mothers without a college degree, but it has only a slight effect on the participation of married women with college degrees. This roughly corresponds to some of the downward trends in labor force participation in the 21st century. The labor force participation rate is the part of the population that works or seeks work. Employment covered by the UI (about 98 percent of jobs) is calculated by converting total non-agricultural jobs into the number of people employed through residence adjustment factors; these factors are adjusted to take into account travel, permanence in several jobs and unpaid leave.
Estimates of the labor force of the country, the 50 states, the District of Columbia, Puerto Rico and seven metropolitan areas are seasonally adjusted to account for predictable and non-economic events affecting the level of employment and unemployment. At the beginning of each year, the monthly employment estimates in the Manual are updated to incorporate the revised estimates of non-farm employment and seasonal factors of the BLS for agricultural workers, self-employed workers, unpaid family workers and private domestic workers. The manual on the unemployed is updated with revised information on monthly UI requests and population proportions by age group to assign workers entering the state workforce to the LAMs. .