Question

he Bureau of Labor Statistics (BLS) adjusts the numbers from the household survey to estimate the employment picture for the entire population. Once the adjustment is made, the BLS uses the figures to generate key employment indicators.

The following table presents information from the household surveys conducted for December 2017 and, for purposes of comparison, December 2016. The numbers in the table are listed in thousands. For example, the number of unemployed in the table for December 2017 indicates that about 6.6 million people were unemployed at that time.

Use the information lists that follow the table to help you fill in the missing values in the table.

	December
	2016	2017
Civilian noninstitutional population	254,742	256,109
Civilian labor force	159,735	161,523
Participation rate	62.7%
Employed	152,233	154,021
Employment–population ratio	59.8%
Unemployed	7,502	6,576
Official unemployment rate	4.7%
Unemployed 15 weeks or more	3,060	2,397
U-1 labor underutilization	1.9%
Discouraged workers	5,674	5,308
U-4 labor underutilization	8.0%

The following list shows you how to compute the statistics most commonly used to indicate the health of an economy:

•	The participation rate is the percentage of the working-age population in the labor force—either employed or searching for employment. In December 2016, the participation rate was 159,735254,742×100=62.7%159,735254,742×100=62.7%.
•	The employment–population ratio is the percentage of the working-age population that is employed. In December 2016, the employment-population ratio was 152,233254,742×100=59.8%152,233254,742×100=59.8%.
•	The official unemployment rate is the percentage of the labor force that does not have a job but is actively searching for employment. In December 2016, the official unemployment rate was 7,502159,735×100=4.7%7,502159,735×100=4.7%.

To get a more accurate picture of underemployment in the economy, the BLS calculates several alternative measures of labor underutilization:

•	The U-1 measure of labor underutilization measures the percentage of the labor force that has been unemployed for 15 weeks or more at the time of the household survey. In December 2016, U-1 was 3,060159,735×100=1.9%3,060159,735×100=1.9%.
•	Another measure, the U-4 measure of labor underutilization, treats discouraged workers as though they were unemployed and part of the labor force. To calculate U-4, the BLS divides the sum of unemployed and discouraged workers by the sum of the labor force and discouraged workers. In December 2016, U-4 was 7,502+5,674159,735+5,674×100=8.0%7,502+5,674159,735+5,674×100=8.0%.

Based on the numbers in the previous table, indicate whether each of the following statements accurately describes the differences in the employment situation between December 2016 and December 2017.

Statement	True	False
A larger fraction of the civilian noninstitutional population was in the labor force in December 2017 than in December 2016.
A larger number of jobless people who wanted a job and were available to work had given up on their job search in December 2017 compared to December 2016.
The U-1 and U-4 measures of labor underutilization were lower in December 2017 than they were in December 2016.
In December 2017, a smaller fraction of the civilian noninstitutional population was employed than in December 2016.
The typical unemployed worker in December 2017 was less likely to have been unemployed for 15 weeks or more than the typical unemployed worker in December 2016.

The official unemployment rate and the U-4 measure of labor underutilization are two different measures of joblessness in the economy.

Excluding discouraged workers from the official unemployment rate may cause the official rate to   the true extent of underemployment.

Answer 1

The proportion of ciilian population, who is a part of the labour force in the year 2016= 159735/ 254742= 0.62

The proportion of civilian opulation, who is a part of the labour force in the year 2017 = 161523/256109 = 0.63

Thus, the proportion of population in the workforce was larger in the year 2017, than in the year 2016. So, the statement is true.

The number od discouraged wourker in the year 2016 was 5674 and the number of discouraged worker in the year 2017 was 5308. Thus, the statements is false.

The exclusion of discouraged workers would not lead to the fluctuation in the true rate of underemployment, as the discoouraged workers are not a part of the labour force.