Employment is a macroeconomic indicator that indicates the ratio of the civilian labor force currently employed to the total working age population of the region, municipality or country. It is calculated by dividing the number of people working in the overall number of people of working age, and is used as a metric of labour and unemployment. For example, if 50 million people are working in the area with 75 million people of working age, the employment rate is 66.7%. It is calculated by the formula:
This measure is similar to the coefficient of labor force participation, which measures the total workforce – and not just the part of the labour force already employed to the total population. Civilian labor force
Civilian labor force-a term used by the Bureau of labor statistics (BLS) to refer to Americans who are either employed or unemployed. Those not included in the employment count forces include military personnel, Federal civil servants, pensioners, disabled or desperate to find work, and some agricultural workers.
The breaking down of the employment’
Compared to other indicators, the employment-to-population ratio does not depend on seasonal fluctuations or short-term fluctuations in the labour market. As a result, it is often considered a more reliable indicator of shrinkage and growth than the number of unemployed in particular.
Restrictions of employment
Employment does not include the institutional population, such as people in mental hospitals and prisons, as well as people at school, studying for a career. He also ignores black labor market, the absence of correlation seem lower than it should be.
The employment rate also does not take into account those people who are over or under the working age, but continue working, for example babysitter or child actors. These workers can be regarded in a busy part of the ratio, but may not be included in the total number of people of working age, and hence their employment increases the ratio inaccurate. In addition, the number of hours worked is not counted, and, as a consequence, the ratio does not distinguish between part-time and full-time work.
As employment levels the unemployment rate
Surprisingly, the level of employment is not directly related with the unemployment numbers. For example, in October 2014, the employment rate is 59.5% and the unemployment rate was only 3.5%. Together, these figures only 63% of the population, raising the question of what happened to the other third of the population.
The discrepancy between these two figures exists because the number of unemployed does not indicate the number of people without work. It indicates only the number of unemployed people looking for work.
For example, people who are early retired and people who decided to return to school to further their prospects for work are not taken into account rate will remain at the same level. However, their absence in the team nodded in employment. In addition, people who really want but gave up on the quest to find the one not included in the number of unemployment in the country.