Suppose the unemployment rate is 6%, the total working-age population is 120 million, and the number of unemployed is 3.5 million. Determine: (a) The participation rate. (b) The size of the labor force. (c) The number of employed workers. (d) The Employment-Population rate.

(a) The participation rate.

94%

(b) The size of the labor force.

58.33 million

(c) The number of employed workers.

54.83 million

(d) The Employment-Population rate.

45.70%

Explanation:

(a)

Participation rate = (Number of Employed People / Labor force) x 100

Participation rate = (54.83 / 58.33) x 100

Participation rate = 94%

(b)

Unemployment rate = (Unemployed People / Labor force) x 100

6% = 3.5 million / Labor force

Labor force = 3.5 million / 6%

Labor force = 58.33 million

(c)

Number of Employed People = Labor force - Unemployed people

Number of Employed People = 58.33 - 3.5 = 54.83 million

(d)

The Employment-Population rate = (Number of Employed People / Working age population) x 100 = (54.83 / 120) x 100 = 45.7%