Question

Suppose the adult population over the age of 16 is 237.8 million and the labor force is 153.9 million (of whom 139.1 million are employed.). How many people are "not in the labor force?" What are the proportions of employed, unemployed and not in the labor force in the population? Hint: Proportions are percentages.

Short answer

There are 83.9 million people not in the labor force. The proportions are as follows: - Employed: \(58.49\%\) of the adult population - Unemployed: \(6.22\%\) of the adult population - Not in the labor force: \(35.29\%\) of the adult population

Step-by-step solution

1. Calculate the number of people not in the labor force

To find the number of people not in the labor force, we will subtract the labor force from the adult population over the age of 16. Not in labor force = Adult population - Labor force Not in labor force = 237.8 million - 153.9 million

2. Calculate the number of unemployed people

To find the number of unemployed people, we will subtract the number of employed people from the labor force. Unemployed = Labor force - Employed Unemployed = 153.9 million - 139.1 million

3. Calculate the proportions of employed, unemployed, and not in the labor force

Now, we will find the proportions. To do this, we will divide the number of people in each category (employed, unemployed, and not in the labor force) by the total adult population and multiply by 100 to get the percentage. Proportion of employed = (Employed / Adult population) * 100 Proportion of unemployed = (Unemployed / Adult population) * 100 Proportion of not in the labor force = (Not in labor force / Adult population) * 100

4. Answer the questions with calculated values

Now we plug in the values we calculated before: Not in labor force = 237.8 million - 153.9 million = 83.9 million Unemployed = 153.9 million - 139.1 million = 14.8 million Proportion of employed = (139.1 million / 237.8 million) * 100 Proportion of unemployed = (14.8 million / 237.8 million) * 100 Proportion of not in the labor force = (83.9 million / 237.8 million) * 100

5. Conclusion

There are 83.9 million people not in the labor force. The proportions are as follows: - Employed: \(\frac{139.1}{237.8} * 100 = 58.49\%\) of the adult population - Unemployed: \(\frac{14.8}{237.8} * 100 = 6.22\%\) of the adult population - Not in the labor force: \(\frac{83.9}{237.8} * 100 = 35.29\%\) of the adult population

Key concepts

Adult Population Employment

Understanding the employment dynamics of the adult population is crucial in evaluating the economic well-being of a country. When economists refer to 'adult population employment', they are focusing on the portion of the adult population over the age of 16 who are currently employed.

The recent exercise provided us with a valuable insight into this aspect by showcasing that out of a total adult population of 237.8 million, 139.1 million are employed. This signifies the ability of the economy to create jobs and provide employment opportunities for its citizens. In a healthy economy, the ratio of employed adults should be constant or increasing, indicating that there are enough job opportunities to accommodate the workforce.

To articulate the significance of this number, we can express it as a proportion or percentage of the total adult population. This is calculated by dividing the number of employed individuals by the total adult population and then multiplying by 100, which in our case represents a 58.49% employment rate of the adult population.

A closer examination of these figures can tell us more about the state of the economy, such as the types and quality of jobs available, and can be a basis for policy-making to improve employment rates.

Unemployment Rate Calculation

The unemployment rate is a pivotal statistic for any economy, as it reflects the percentage of the labor force that is actively seeking employment but is unable to find work.

The calculation of the unemployment rate follows a simple formula: It is the number of unemployed individuals divided by the total labor force, multiplied by 100 to get a percentage. In our textbook exercise, the unemployed figure is determined by subtracting the number of employed persons from the total labor force, yielding 14.8 million unemployed individuals from a labor force of 153.9 million.

Formula for Unemployment Rate

The unemployment rate can be calculated using the formula:
\[\text{Unemployment Rate} = \left(\frac{\text{Number of Unemployed}}{\text{Labor Force}}\right) \times 100\]
Applying the numbers from our exercise gives us an unemployment rate of \(\frac{14.8}{153.9} \times 100 = 9.62\%\). This rate is an essential indicator for economists and policymakers to gauge the unemployment situation and is a crucial metric for economic planning and decision-making.

Labor Force Participation Rate

The labor force participation rate is an important metric that provides insight into the active engagement of the eligible population in the workforce. It measures the proportion of the adult population that is either employed or actively looking for work. Unlike the unemployment rate, which only accounts for those actively seeking employment, the participation rate includes all individuals who are part of the labor force.

The calculation involves dividing the total labor force by the adult population and then multiplying by 100 to get a percentage. Based on our exercise, where the labor force is 153.9 million in a total adult population of 237.8 million, the formula for the participation rate would be:
\[\text{Labor Force Participation Rate} = \left(\frac{\text{Labor Force}}{\text{Adult Population}}\right) \times 100\]
This would result in a labor force participation rate of \(\frac{153.9}{237.8} \times 100 = 64.71\%\). This number helps us gauge the level of activity in the labor market and the availability of labor, which can influence economic growth and productivity. It's also indicative of social and economic factors that may influence an individual's decision to engage in the labor market, such as education levels, cultural norms, and economic incentives.