Suppose that in a population of 50 million persons, 40 million are in the labor force, 36 million are employed, 2 million are classified as unable to work, and 1 million are classified as unwilling to work. the unemployment rate is

To answer this question, let us use the following definitions from the Bureau of Labor Statistics:

1. Unemployed - you must be over 16, and available to work full-time, actively looking for work during the past four week period.

2. The labor force - includes the unemployed plus the employed, no one else

3. Unemployment rate - the number of unemployed divided by the total labor force.

To calculate:

Let X = Unemployment Rate = Unemployed / Total Labor Force

X = (Total Labor force - Employed) / Total Labor Force

X = (40-36) / 40

X = 4/40

X =.10 or 10%