Figures Used to Measure Unemployment Rate

Are you totally aware as to how the government measures the unemployment rate on a monthly basis? If not, then you have come to the right article. It is a major economic indicator of a country and that is the main reason why unemployment rate is measured on a monthly basis. By measuring the unemployment rate monthly the Department of Labor is able to perform their job in informing the public about the employment situations of the country. They are better able to assess whether or not business sectors have high demands for workforce in order for jobseekers to get jobs.

When the department measures unemployment they have to make sure that they are including figures of people grouped accordingly based on their criteria for calculating unemployment. First, the number of unemployed workers is extracted by only including those who have lost their jobs through no fault of their own. A worker may have lost his job by company’s downsizing, announcement of bankruptcy, retrenchment, or layoff. Other than this factor, the eligible worker must also be seeking for jobs in the last four weeks and is physically able and available for work anytime in order to be included in the total number of unemployed workers.

Next to the figures of unemployed workers, the department will need to evaluate the total number of the labor force which represents the figures both of the employed and unemployed workers. The employed workers are easily determined by getting the data of company payroll from employers. In short, labor force is equivalent to employed workers plus unemployed workers.

Now, the department can move on with the calculation of the unemployment rate by dividing the number of unemployed workers to the number of the labor force. An employment summary report is released to the public through media every first Friday of the month.