At 8:30 AM, Washington DC time, on Friday August 7, 2015, the Bureau of Labor St

ID: 1167647 • Letter: A

Question

At 8:30 AM, Washington DC time, on Friday August 7, 2015, the Bureau of Labor Statistics (BLS) made the following announcement:

THE EMPLOYMENT SITUATION -- July 2015

Total nonfarm payroll employment increased by 215,000 in July, and the unemployment rate was unchanged at 5.3 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in retail trade, health care, professional and technical service, and financial activities.

9a) How does the BLS determine the unemployment rate for July 2015?

9b) How does the BLS determine the employment rate?

Right after the BLS announced the employment level and the unemployment rate for July 2015, a bunch of Wall Street analysts offered their opinions about what Ms. Janet Yellen, the Chairman of the Federal Reserve Bank, next steps would be. The majority of the analysts stated that Ms. Yellen will let interest rates rise by September2015. Their opinions are based on the following:

Unemployment

Rate

Employment

Increase

April

5.4 %

187,000

May

5.5 %

260,000

June

5.3 %

231,000

July

5.3%

215,000

However, other analysts believe that Ms. Yellen will delay raising interest rates due to the economic slowdown in Europe, China and other Asian countries.

9c) Please provide your opinions on which direction Ms. Yellen should take and why?