The labor force comprises of all person over the age of 16 who are either working for pay or actively seeking paid employment. Essentially, this sector is comprised of the employed and the unemployed. The paper deals with the many effects of unemployment on today's U.S. economy. One can define unemployment as the inability of labor force participants to find jobs. To make full use of production, the labor force must b fully employed. When full employment - the lowest rate of unemployment compatible with price stability variously estimated at between 4& 6 percent unemployment. When full employment isn't achieved, there's a strain on the economic growth- increase in output (real GDP-the value of final output produced in a given period adjusted for changing prices), which then puts a strain on the labor this creating the problem of unemployment. In order to critically analyze the effects of unemployment on the labor market, we must focus on the availability of jobs, wages stability; rate of unemployment; duration of unemployment and the issue of jobless recovery.
Unemployment is measured by the U.S. census Bureau through a method of surveying. The bureau surveys approximately 60,000 households each month to determine how many people are employed and unemployed (Schiller, 115). The bureau defines the employed as those that have "worked for pay in the previous week or didn't work due to illness, vacation bad weather or a labor strike. If the person isn't employed, he or she is either unemployed or out of the labor force .if a person is not employed and actively seeking a job he or she counted as unemployed" (Schiller, 115-116). Furthermore, the Census Bureau calculates the actual unemployment rate using the formula, .
Unemployment rate = number of unemployed.
Labor force .
This measurement of the unemployment rate is helpful in determining the amount of people unemployed and keeps track of the unemployment on a month to month basis.