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How Discouraged Workers Fit Into The Labor Force

by Jadrian

There is a common misunderstanding that the unemployment rate is just the opposite of the employment rate, which is not the case. Workers in the economy can be classified into more than just being employed or unemployed. Only workers who are participating in the labor force can be considered employed or unemployed. There are many people who don't participate in the labor force (retirees, teenagers, babies!) and shouldn't be counted in the unemployment rate.

Discouraged workers are workers who have given up looking for the job and then become classified as "not actively looking for work," which removes them from the labor force. Becoming a discouraged worker does not mean that they are counted as employed.

Donald Trump Misdefines Discouraged Workers During GOP Debate

During the CNN Debate in Miami on March 10, 2016, Donald Trump mischaracterizes discouraged workers as being statistically employed.

from CNN (2016)
Creator: CNN
Distributor: YouTube
Posted by Jadrian