Question

Measuring employment, unemployment, and labor force participation

Consider a small economy composed of six people: Larry, Megan, Raphael, Susan, Becky, and Alex. Each person's employment status is described in the following table.

Based on the criteria used by the Bureau of Labor Statistics (BLS), identify each person’s status as employed, unemployed, “not in the labor force” (if not in the civilian labor force but still part of the adult population), or “not in the adult population” if not in the civilian adult population.

Person	Status
Larry is a 46-year-old autoworker who was laid off from his job 6 months ago. He is frustrated with his inability to find a new full-time position. Last week, he took a part-time job but was given only 3 hours of work.
Megan is a 31-year-old professional basketball player. She finished her last season as a player 3 weeks ago and is currently interviewing for a coaching position.
Raphael is a 44-year-old accountant who has been out of work for almost a year. He became so discouraged that he gave up on his job search a couple of months ago.
Becky is a 26-year-old who lost her job as a copy editor for a local newspaper. She has spent the past few weeks out of work and interviewing for other editing jobs. She is thinking about going back to grad school if her job search doesn't succeed after a few more weeks.
Alex is a 17-year-old who just graduated from high school. He is taking it easy this summer, relaxing by the pool with his friends and family, and volunteering part-time at the local nursing home.
Susan is a 11-year-old student at Southside Middle School. She babysits her younger sister and does other chores, so her parents give her an allowance of $30 per week.

Complete the right half of the following equation to reflect the labor force participation rate reported by the BLS.

Labor Force Participation RateLabor Force Participation Rate

=

Please enter the formula for the above equation

According to this formula, what is the labor force participation rate of this economy of six people?

20%

60%

66.67%

200%

Complete the right half of the following equation to reflect the unemployment rate reported by the BLS.

Unemployment RateUnemployment Rate

=

Please enter the formula for the above equation

According to this formula, what is the unemployment rate of this economy of six people?

20%

60%

66.67%

200%

Answer 1

Person	Status
Larry is a 46-year-old autoworker who was laid off from his job 6 months ago. He is frustrated with his inability to find a new full-time position. Last week, he took a part-time job but was given only 3 hours of work.	Employed
Megan is a 31-year-old professional basketball player. She finished her last season as a player 3 weeks ago and is currently interviewing for a coaching position.	Unemployed
Raphael is a 44-year-old accountant who has been out of work for almost a year. He became so discouraged that he gave up on his job search a couple of months ago.	Not in the labor force
Becky is a 26-year-old who lost her job as a copy editor for a local newspaper. She has spent the past few weeks out of work and interviewing for other editing jobs. She is thinking about going back to grad school if her job search doesn't succeed after a few more weeks.	Unemployed
Alex is a 17-year-old who just graduated from high school. He is taking it easy this summer, relaxing by the pool with his friends and family, and volunteering part-time at the local nursing home.	Not in the labor force
Susan is a 11-year-old student at Southside Middle School. She babysits her younger sister and does other chores, so her parents give her an allowance of $30 per week.	Not in the adult population

Labor force includes Employed+Unemployed while Adult population includes Employed+Unemployed+Not in the labor force

Labor Force Participation RateLabor Force Participation Rate

=

Number in labor force/Adult population x100

The labor force participation rate of this economy of six people is : 3/5x100= 60%

Unemployment RateUnemployment Rate

=

Number of unemployed workers/Labor forcex100

The unemployment rate of this economy of six people is 2/3x100 = 66.67%