2. Discouraged workers following statements correctly describe discouraged worke

Question

2. Discouraged workers following statements correctly describe discouraged workers? (If none of the choices apply, leave all of the checkboxes blank.) Check all that apply O They are employed workers who want to carn higher wages. They are counted as part of the labor force by the Bureau of Labor Statistics. They have not looked for a job in 4 weeks (or longer), but they would like a job and are avalable for work. They are dissatisfied with their current jobs and are considering quitting The following table contains U.S. employment information from December 2010. Civilian Population Employed Unemployed Discouraged (Persons 16 years old and over) (Persons) (Persons) (Persons) 238,889,000 139,206,000 14,485,0001,318,000

Explanation / Answer

Discouraged Workers - These are those workers who are unemployed but have not looked for jobs in past 4 weeks (or longer) and thus are not included as officially unemployed in its calculation of unemployed by the Bureau of Labor Statistics. However, these persons would be available for work.

Hence, the correct answer is the option (3).

Labor force = Employed + Unemployed = 139,206,000 + 14,485,000 = 153,691,000

Caculate the official unemployment rate -

Official unemployment rate = (Unemployed/Labor force) * 100 = (14,485,000/153,691,000) * 100 = 9.42%

Calculate the U-4 measure of Labor under-utilization -

U-4 = [(Unemployed + Discouraged)/(Labor force + Discouraged)] * 100

U-4 = [(14,485,000 + 1,318,000)/(153,691,000 + 1,318,000)] * 100

U-4 = (15,803,000/155,009,000) * 100

U-4 = 10.19%

Following is the complete table -

Official Unemployment Rate

(Percent)

U-4 Measure of Labor Underutilization

(Percent)

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

Official Unemployment Rate

(Percent)

U-4 Measure of Labor Underutilization

(Percent)

9.42 10.19

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