Question

Suppose 1 800 000 people are employed, 40 000 people are unemployed, and an additional
250 000 people are not in the labour force but are of working age. What is the formula for the
unemployment rate?. And how do you Calculate the unemployment rate.

What is the formula for the labour force participation rate? and if so how do you calculate this?

Thanks and i hope you have a great day.

Answer 1

Unemployed people refers to those people who are over 16 years and are ready to work but do have jobs. It is calculated by diving number of the people who are unemployed are by total number of labor force multiplied by 100. The formula is;

Unemployment Rate= Unemployed people/Total labor force.

In this question;

The unemployed people are= 1,800,000+ 40,000+ 250,000= 2090,000 people.

Unemployed people= 40,000

Thus,

Unemployment Rate= 40,000/2,090,000*100%

                                  =1.9%

What is the formula for the labour force participation rate? And if so how do you calculate this?

Labor force participation rate is calculated by dividing total number of people employed with the total population and then multiply by 100. The formula is;

Participation rate= Employed people/Total population

 In the question;

Employed people= 1, 800, 000

Total population=2,090,000

Thus,

Participation rate=1800000/2090000*100

                           =86.1%