The national unemployment rate is determined by the Bureau of Labor Statistics.
The Bureau of Labor Statistics (BLS), a division of the United States Department of Labor, publishes the national unemployment rate each month, which indicates the total number of people and the percentage of the civilian labor force unemployed during the previous month. To generate these numbers, the government conducts a monthly National Current Population Survey (CPS), which consists of a sample of approximately 110,000 people in about 60,000 households. Each month, during the week containing the 12th day of the month, Census Bureau interviewers collect information from each family, including a list of family members, dates of birth, gender, race, ethnicity, and education level. The examiner also collects data on the employment status of each family member over the age of 16 and classifies them into one of three classifications: employed, unemployed, or not in the labor force. After collecting the information, the bureau extrapolates and weights the numbers with respect to race, gender, ethnicity, age, and residential status to reflect the proportions found in the United States, from which the agency derives the rate. of national unemployment.
Unemployed people who are currently looking for work are included in the national unemployment rate.
The Census Bureau carefully selects each CPS unit to provide a representative cross-sample of the entire population of the United States (US). After dividing the US into approximately 2,025 geographic divisions, the agency chooses 824 areas to include in the sample, ensuring that it covers all states, as well as a wide range of industries, farms, rural and urban settings. Each household in the sample provides information for four consecutive months, then rotates the sample for eight months, and then re-sample for another four months, providing comparable data with the previous year. In any given month, 25% of households in the CPS change, while 75% of the sample provides a national unemployment rate comparable to the previous month with around 50% comparable to the previous year.
The BLS computers strictly interpret and assign the workforce qualifications of the individuals in the sample. A person is employed if they do any type of work, regardless of whether the work is temporary, part-time or full-time, paid or unpaid, during the sample week. This designation also includes workers who did not work during the sample week but who have jobs such as maternity leave, vacation, sick leave, and strike. Unpaid workers who contribute at least 15 hours of service to a family business also fall into this category. Institutionalized people, such as prisoners and the military, are not included in the employment statistics.
The unemployed ranks, from which the national unemployment rate is produced, include those who are currently unemployed but available for work. To meet the definition of unemployed, the person must have been actively looking for work during the four weeks prior to the sample week. Active job search may include contacting an employment agency, contacting or interviewing a potential employer, submitting resumes, and responding to job advertisements. The BLS also assigns workers on temporary furloughs or layoffs for this category. This definition does not include discouraged unemployed workers who have not engaged in active job search activities in the past four weeks.
Unemployed people who are not currently looking for work are classified as “out of labor force.” A stay-at-home mom, a person with a disability, or a discouraged worker with long-term unemployment may fall into this category. People who looked for work in the previous 12 months are subsequently designated as “marginally tied to the labor force”. Since the BLS assigns an individual to only one category, the bureau gives priority to any form of work activity. For example, an unemployed teacher who works part-time at a fast food franchise is considered employed, even though she is considered seriously underemployed.