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Labour Force Participation Rate

Definition

The labour force divided by the relevant population, expressed as a percentage. It measures participation in work or job seeking, rather than employment alone.

Canada

How can unemployment rise when employment grows?

If 100 more people enter the labour force and 60 find work, both employment and the number of unemployed can rise. Participation measures the share of the eligible population that is working or unemployed.

Statistics Canada Labour Force Survey

United States

Why can unemployment fall when people stop looking for work?

The U.S. unemployment rate uses the labour force as its denominator. If 10 of 100 people are unemployed and two stop looking and leave the labour force, the rate falls from 10% to roughly 8.2%, even though employment stays at 90.

U.S. Bureau of Labor Statistics employment report

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