Greatra Mayana

Career & Employment Opportunities

Labour force – employment, unemployment and participation rate explained

– I’m Bjorn Jarvis from the Australian Bureau of Statistics. People sometimes ask me, “How can the unemployment rate go up if the number of employed
people is also going up?” The answer to this is
actually quite simple. But it’s important to remember that there are three groups of people in the labour market: the
employed, the unemployed, who together make up what we
refer to as the labour force, and a third group who are
outside of the labour force, which includes people like retirees, people who are caring full time, or people who are in study
on a full-time basis. At times, the employed and the unemployed will both be increasing, which is why the participation
rate is an important measure to also have a look at. If people from outside the
labour force start participating, unemployment can also
increase alongside employment. And this may mean that people
are becoming more confident in the labour market and
that they’re now starting to actively look for work.

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