1.1 Suppose that the population over age 16 is 150 million, the number of discou

Question

1.1 Suppose that the population over age 16 is 150 million, the number of discouraged workers is 5 million, the number of unemployed workers is 10 million, and there are 100 million employed. What is the participation rate? (“Population” in this type of question refers to the adult civilian, non-institutionalized population.)

1.2 This council, an advisory body with business and union representation, decided to rethink the concept of unemployment. It was intent on unraveling the paradox of substantial new job creation coupled with a high and largely unyielding jobless rate.

How could this paradox come about?

1.3. Job creation in October was much more robust than most forecasters had predicted, but the number of people either working or looking for work increased even more sharply.

a. What is happening to the unemployment rate?

b. Should this news be viewed as positive or negative? Why?

Explanation / Answer

Answer : 1.1) The Formula of participation rate is ,

Participation rate = ( Labour Force / Working - age Population ) × 100 = [ ( 5 + 10 + 100 ) / 150 ] × 100

= 115/150 × 100 = 76.667

Therefore, the participation rate is 76.667

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