Unemployment rates and the labor market
Katharine Abraham’s comments featured in a story about how unemployment rates are calculated
In an article for Marketplace, Janet Nguyen reports on the unemployment rate and the labor market - key factors during a climate of uncertainty about government services. The headline unemployment rate of 4.2% is calculated by dividing the number of unemployed by the number of people in the workforce. “The official unemployment rate is one that’s based on an internationally agreed upon definition that a lot of thought went into,” said Katharine Abraham. This rate is known as the U-3 rate as defined by The Bureau of Labor Statistics (BLS). The U-3 rate is a “pretty sound concept,” as it does not include unemployed individuals who are not available for work, explains Katharine Abraham.