Employment-to-population ratio

The Organization for Economic Co-operation and Development defines the employment rate as the employment-to-population ratio. This is a statistical ratio that measures the proportion of the country's working age population (statistics are often given for ages 15 to 64) that is employed. This includes people that have stopped looking for work. The International Labour Organization states that a person is considered employed if they have worked at least 1 hour in "gainful" employment in the most recent week.

The employment-population ratio has not always been looked at for labor statistics and where specific areas are economically, but after the recent recession it has been given more attention worldwide, especially by economists. The National Bureau Of Economic Research (NBER) states that the Great Recession ended in June 2009. During 2009 and 2010, however, many areas were still struggling economically, which is the reason the employment-population ratio is still used by both Americans and people around the world.

Key terms that explain the use of the ratio follow:

Employed persons. All those who, (1) do any work at all as paid employees, work in their own business or profession or on their own farm, or work 15 hours or more as unpaid workers in a family-operated enterprise; and (2) all those who do not work but had jobs or businesses from which they were temporarily absent due to illness, bad weather, vacation, childcare problems, labor dispute, maternity or paternity leave, or other family or personal obligations — whether or not they were paid by their employers for the time off and whether or not they were seeking other jobs.

Unemployed persons. All those who, (1) have no employment during the reference week; (2) are available for work, except for temporary illness; and (3) have made specific efforts, such as contacting employers, to find employment sometime during the past 4-week period.

Participant rate This represents the proportion of the population that is in the labor force.

Not in the labor force. Included in this group are all persons in the civilian noninstitutional population who are neither employed nor unemployed. Information is collected on their desire for and availability to take a job at the time of the CPS interview, jobsearch activity in the prior year, and reason for not looking for work in past 4-week period.

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