2. Discouraged workers Which of the following statements correctly describe disc

Question

2. Discouraged workers

Which of the following statements correctly describe discouraged workers? (If none of the choices apply, leave all of the checkboxes blank.) Check all that apply.

They have not looked for a job in 4 weeks (or longer), but they would like a job and are available for work.

They have given up on looking for a job.

They are full-time workers who would like to work only part-time.

They are counted as part of the labor force by the Bureau of Labor Statistics.

The following table contains U.S. employment information from February 2010.

The Bureau of Labor Statistics has several measures of joblessness in addition to the official unemployment rate. One alternative is the U-4 measure of labor underutilization, which is calculated as follows:

Fill in the following table by calculating the official unemployment rate and the U-4 measure of labor underutilization.

The official unemployment rate and the U-4 measure of labor underutilization are two different measures of joblessness in the economy.

If the Bureau of Labor Statistics were to include discouraged workers in the official unemployment rate, the reported unemployment rate would .

Civilian Population Employed Unemployed Discouraged (Persons 16 years old and over) (Persons) (Persons) (Persons) 236,998,000 138,698,000 14,860,000 1,204,000 U-4

Explanation / Answer

Ans:

Explanation:

According to Bureau of Labor Statistics any jobless person who has not looked for work in the past 4 weeks is not in the labor force. And discouraged workers give up on their search because they feel that there are no current opportunities for them in the labor market.

Labor force = Employed + unemployed = 138,698,000 + 14,860,000 = 153,558,000

Official Unemployment Rate = (Unemployed / Labor force) * 100

                                             = (14,860,000 / 153,558,000) * 100

                                             = 9.68%

U-4 Measure of Labor Underutilization = [(14,860,000 + 1,204,000) / (153,558,000 + 1,204,000)] * 100

                                                              =(16,064,000 / 154,762,000) * 100

                                                              = 10.38%

Official Unemployment Rate U-4 Measure of Labor Underutilization (Percent) (Percent) 9.68 10.38

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