Question

Suppose the civilian noninstitutionalized working-age population is 35.9 million in in a hypothetical economy. Of these, 4.9million are working part-time and 14.53 million are working full-time. Assume the Bureau of Labor Statistics (BLS) definitions are used for calculating unemployment data.

Among those not working, the most recent job-search activity for 2.90 million happened less than two weeks ago, while 1.72million most recently looked for work between two and four weeks ago. An additional 0.86 million most recently looked for work five weeks ago, and the remaining 10.99 million who do not have jobs have not looked for work in the past six weeks. Round your answers to two decimal places.

1) What is the size of the total labor force?

2) How Many people are unemployed

3) What is the labor force participation rate?

4) What is the unemployment rate?

Answer 1

Answer : 1) Employed people = part time workers + Full time workers

=> Employed people = 4.9 + 14.53

=> Employed people = 19.43 million

Unemployed people are those people who are not working but actively searching job for last 4 weeks. So,

Unemployed people = 2.90 + 1.72 = 4.62 million

Labor force = Employed people + Unemployed people

=> Labor force = 19.43 + 4.62 = 24.05 million

Therefore, the total labor force size is 24.05 million.

2) Unemployed people are those people who are not working but actively searching job for last 4 weeks. So,

Unemployed people = 2.90 + 1.72 = 4.62 million

Therefore, 4.62 million people are unemployed.

3) Labor force participation rate = (Labor force / Total population) * 100

=> Labor force participation rate = (24.05 / 35.9) * 100

=> Labor force participation rate = 0.6699 * 100 = 66.99%

Therefore, the labor force participation rate is 66.99%

4) Unemployment rate = (Unemployed people / Labor force) * 100

=> Unemployment rate = (4.62 / 24.05) * 100

=> Unemployment rate = 0.1921* 100 = 19.21%

Therefore, the unemployment rate is 19.21%