How Is The Unemployment Rate Calculated?
As of October 2009, more than 15 million Americans were out of work, and the unemployment rate in the United States was listed at 9.8%.
But who counts as unemployed, and how exactly are unemployment statistics determined?
It’s not what you think
A common misconception of the unemployment rate is that it measures how many Americans are currently collecting unemployment benefits from the government. This is incorrect for a number of reasons. Primarily, not everyone in the country who is eligible for unemployment is actually receiving unemployment benefits. Secondly, many people who are unemployment could have run out of unemployment benefits.
The United States unemployment rate is actually an estimate based on a survey conducted every month by a division of the U.S Census Bureau.
Bureau of Labor Statistics
The unemployment rate is recalculated every month based on a survey known as the Current Population Survey. This survey is conducted on behalf of the Bureau of Labor Statistics by the Census Bureau.
The Survey
The Current Population Survey questions 60,000 randomly selected households in the United States every month. This equals approximately 110,000 individuals, which is much more than the average 2,000 people questioned in public optinion polls. The households chosen to participate are intended to be a cross-section representing the entire United States population.
Among other questions, the Current Population Survey tallies how many people in every household are eligible and looking for work. To be considered part of the labor force, and individual must be aged 16 or older and either currently be employed or looking for work. People who are not currently employed and are not looking for work are not included in the labor force or unemployment rate.
The Calculation
The percentage of the labor force found in the Current Population survey who are out of work and looking for employment are then compared to the current United States population and used as a representation of the number of unemployed Americans.
Unemployment is a serious issue today. The current U.S. unemployment rate is 9.8% as of this writing. Truly staggering. Unemployment benefits are your right. And nowadays you can even file for unemployment benefits online. Article Source:http://www.articlesbase.com/careers-articles/how-is-the-unemployment-rate-calculated-1416046.html
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