Labor force

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In economics the people in the labor force are the suppliers of labor. In the United States, the labor force is defined as people 16 years old or older who are employed or looking for work. However, child labor laws forbid businesses from employing people between the ages of 16 and 18 in hazardous jobs.

Normally, the labor force consists of everyone of working age (typically above a certain age (around 14 to 16) and below retirement (around 65) who are participating workers, that is people actively employed or seeking employment. People not counted include students, retired people, stay-at-home parents, people in prisons or similar institutions, as well as discouraged workers who simply do not want work.

United States' Labor Force Participation Rate 1948-2006.Source: United States Bureau of Labor Statistics
United States' Labor Force Participation Rate 1948-2006.
Source: United States Bureau of Labor Statistics

The ratio between the labor force and the overall size of their cohort (national population of the same age range) is known as the labor force participation rate (total labour force/cohort). In the West during the latter half of the 20th century, the labor force participation rate increased significantly, largely due to the increasing number of women entering the workplace. In the United States, the labor force participation rate rose from approximately 59% in 1948 to 66% in 2005[3], with participation among women rising from 32% to 59%[4] and participation among men declining from 87% to 73%[1][5]. Conversely, the labor force participation rate can decrease when the rate of growth of the population outweighs that of the employed and unemployed together.


The fraction of the labor force that cannot find work determines the unemployment rate.

Contents

[edit] Symbols

Pop = total population

LF = labour force = U + E

LFpop = labour force population

p = participation rate = LF / LFpop

E = number employed

e = rate of employment = E / LF

U = number of unemployed

u = rate of unemployment = U / LF



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[edit] External links

[edit] Notes

  1. ^ Breaking down the male participation rate by age bracket shows a marked decline in participation among men 55 and over from approximately 71% in 1948 to 44% in 2005[1]. Among younger age groups a decline is noticeable, but not nearly as drastic.[2]
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