# unemployment rate - maths

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#1
What does it mean by unemployment rate in this case?
Is it saying unemployment rate = total no. of unemployed people/total no. of people of working age?

As I understand, the unemployment rate formula = no. of unemploymened persons/total population? but I guess it is different in this question as they have specified "people of working age rather than everyone.
Last edited by As.1997; 1 month ago
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1 month ago
#2
(Original post by As.1997)
What does it mean by unemployment rate in this case?
Is it saying unemployment rate = total no. of unemployed people/total no. of people of working age?

As I understand, the unemployment rate formula = no. of unemploymened persons/total population? but I guess it is different in this question as they have specified "people of working age rather than everyone.
The first one. It would generally be that, so 95% employment and 5% unemployment would add to 100%. The divisor must be the size of the working population.
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#3
(Original post by mqb2766)
The first one. It would generally be that, so 95% employment and 5% unemployment would add to 100%. The divisor must be the size of the working population.
For Australia 2015: 6.056% this must tell us that per 100 working age (which includes employed and unemployed) there are 6.056 unemployed?
Last edited by As.1997; 1 month ago
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1 month ago
#4
(Original post by As.1997)
For Australia 2015: 6.056% this must tell us that per 100 working age (which includes employed and unemployed) there are 6.056 unemployed?
Yes.
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#5
(Original post by mqb2766)
Yes.
Thanks!

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#6
Just realized another thing:
When we are talking about unemployed people we are referring to the unemployed of working-age people as opposed to everyone who is unemployed? (as this is what I assumed because otherwise we could count kids as part of the total population which would be strange)
Last edited by As.1997; 1 month ago
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1 month ago
#7
(Original post by As.1997)
Just realized another thing:
When we are talking about unemployed people we are referring to the unemployed of working-age people as opposed to everyone who is unemployed? (as this is what I assumed)
Yes (first one). It would not make sense for 6% unemployment to covers kids and oaps? They'd make ~30% of the total population.
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#8
(Original post by mqb2766)
Yes (first one). It would not make sense for 6% unemployment to covers kids and oaps? They'd make ~30% of the total population.
Perfect, just as I thought otherwise the percentage would have to be a lot bigger than 6%.
Thanks again
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1 month ago
#9
(Original post by As.1997)
Just realized another thing:
When we are talking about unemployed people we are referring to the unemployed of working-age people as opposed to everyone who is unemployed? (as this is what I assumed because otherwise we could count kids as part of the total population which would be strange)
The table explicitly says that the rate is taken as "unemployed people" / "working age population".

In the "real world" it can be somewhat more complicated than you'd think. In particular:

(Original post by mqb2766)
The first one. It would generally be that, so 95% employment and 5% unemployment would add to 100%. The divisor must be the size of the working population.
There are actually a load of working age people not considered either employed (doing a paid job or working in a business they have a share of + some other odd cases), nor unemployed (since they are not looking for work), so if the table is labelled correctly (as #unemployed / #working age) you wouldn't have employed+unemployed summing to 100%.

A relevant term here is the Labour Force, which does equal "no. of employed + no. of unemployed". In both the UK and the US, this is the divisor used for the official rates. (Looking at the figures, I suspect the label in the table is actually incorrect and should be referring to this instead of "working-age population". Then again, it's just an example).
Last edited by DFranklin; 1 month ago
1
1 month ago
#10
(Original post by DFranklin)
The table explicitly says that the rate is taken as "unemployed people" / "working age population".

In the "real world" it can be somewhat more complicated than you'd think. In particular:

There are actually a load of working age people not considered either employed (doing a paid job or working in a business they have a share of + some other odd cases), nor unemployed (since they are not looking for work), so if the table is labelled correctly (as #unemployed / #working age) you wouldn't have employed+unemployed summing to 100%.

A relevant term here is the Labour Force, which does equal "no. of employed + no. of unemployed". In both the UK and the US, this is the divisor used for the official rates. (Looking at the figures, I suspect the label in the table is actually incorrect).
Sure, I was trying to say it's not the total population. As you say, defns can get messy in real life.
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