A rate is a coefficient that expresses the relationship between two quantities. Employment, on the other hand, is a paid occupation, profession, or trade.
The employment rate is known as the ratio between the employed population and the economically active population (which is able to join the labor market). The most common index, however, is the unemployment rate (number of unemployed people over the economically active population). The employment rate, in other words, allows us to indicate the percentage of workers actually employed. For example, if a country’s employment rate is 84%, it means that 84 out of 100 economically active people have a job. The remaining 16 people, on the other hand, are unemployed or unemployed; the country’s unemployment rate, therefore, is 16%.
In this regard, several issues need to be clarified. The first is that the employed population refers to the entire active population, aged 16 or over, who has a job, whether self-employed or employed by others, and who receives a salary for it. In this sense, this typology also includes those people who earn a salary working in the company of a family member with whom they also reside. The second issue that should be clarified is that the labor force is made up of all the people in a given country who have or are looking for a job at that time. In this way, we could see that under the umbrella of that denomination there are, therefore, two clearly defined groups: the employed and the unemployed. It is interesting to clarify that, in order to determine the exact percentage and figures of the active population of a nation, it is necessary to go to the entities that specifically manage it. This would be the case, for example, in Spain of the National Institute of Statistics (INE), whose mission is to calculate different values such as activity or the employment rate based on criteria such as autonomous communities, sex, age… Currently, due to the economic crisis that is sweeping the world, it must be recognized that employment rates in many countries have reached historical milestones, which shows the seriousness of the situation. These statistics are never exact. A subject can be part of the economically active population and not have a job because he is not looking for or has no interest in working. This individual will be considered unemployed even though there may be enough job offers for him to enter the market. The employment rate can also be linked to the notion of full employment, an economic concept that assumes that everyone of working age who wants to work has a job. Therefore, the demand for labor is equal to the supply, which is reflected in an employment rate of 100% and an unemployment rate of 0.
