The following describes the labor market for Jacksonville: The total population

Question

The following describes the labor market for Jacksonville: The total population of the town is 1500 individuals. Of these individuals, 408 are younger than 16 and another 92 are locked up in the county jail. In a recent survey, 650 individuals reported being employed full time. Another 35 reported being employed part-time voluntarily, while 15 reported working part-time despite wanting a full time job. In addition, 240 individuals reported being unemployed and half of them had looked for work in the previous four weeks.

a) What is the employment/population rate?

b) What is the labor force participation rate?

c) What is the official unemployment rate?

Explanation / Answer

a) Employment/population rate = number of employed/total population = (650 + 35 + 15)/1500 * 100 = 700/1500 * 100 = 0.4666 * 100 = 46.66%

Note: The 35 people reported being employed part-time voluntarily and 15 pople reported working part-time despite wanting a full time job are both counted as employed.

b) Labor force participation rate = people available to work/ people eligible for work * 100 = (employed + unemployed)/people eligible for work.

Here, employed = 650 + 35 + 15 = 700

Unemployed = half of 24 people who did not have work and searched for a job in last 4 weeks. = 120 (Note: People who dont have job but did not actively serach for it in last 4 weeks are not countred as employed)

So, people avalable for work = 700 + 120 = 820

People eligible to work = population - (underage people + institutiomalized people) = 1500 - (408 + 92) = 1500 - 500 = 1000.

So, laborforce participation rate = 820/100 * 100 = 0.82 * 100 = 82%

c) Unemployment rate = unemployed/ laborforce * 100

Labor force = employed + unemployed = 700 + 120 = 820

Unemployed = 120

Unemployment rate = 120/820 * 100 = 0.1463 * 100 = 14.63%

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