Unemployment In The Eu And The Euro Area
Eurostat estimates that 14.312 million men and women in the EU, of whom 12.045 million in the euro area , were unemployed in October 2021. Compared with September 2021, the number of persons unemployed decreased by 77 000 in the EU and by 64 000 in the euro area. Compared with October 2020, unemployment decreased by 1.650 million in the EU and by 1.564 million in the euro area.
In October 2021, the euro area seasonally-adjusted unemployment rate was 7.3 %, down from 7.4 % in September 2021 and from 8.4 % in October 2020. The EU unemployment rate was 6.7 % in October 2021, stable compared with September 2021 and down from 7.5 % in October 2020.
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How To Use The Unemployment Rate
Keep in mind that the unemployment rate is a lagging indicator. It tells you what has already happened, since employers only lay off workers after business slows down.
The unemployment rate isn’t lagging as much as usual because the pandemic is still creating sudden changes.
Companies resist hiring new workers when a recession is over until they can be sure that the economy will stay strong. The economy could improve for months, and the recession could be over before the unemployment rate drops. It’s not suitable for predicting trends, but it’s useful for confirming them.
Canada Unemployment Rate 1991
- Canada unemployment rate for 2020 was 9.48%, a 3.82% increase from 2019.
- Canada unemployment rate for 2019 was 5.66%, a 0.17% decline from 2018.
- Canada unemployment rate for 2018 was 5.83%, a 0.51% decline from 2017.
- Canada unemployment rate for 2017 was 6.34%, a 0.66% decline from 2016.
|Canada Unemployment Rate – Historical Data
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Harmonized Unemployment Rate: Total: All Persons For Canada Download
Data in this graph are copyrighted. Please review the copyright information in the series notes before sharing.
OECD unit ID: STSAOECD country ID: CANAll OECD data should be cited as follows: OECD, “Main Economic Indicators – complete database”, Main Economic Indicators , Copyright, 2016, OECD. Reprinted with permission.
Organization for Economic Co-operation and Development, Harmonized Unemployment Rate: Total: All Persons for Canada , retrieved from FRED, Federal Reserve Bank of St. Louis https://fred.stlouisfed.org/series/LRHUTTTTCAM156S, June 3, 2022.
Other Types Of Unemployment
There are some other types of unemployment that are also important to consider. In particular,the underemployment rate can be thought of as a complementary indicator to the unemploymentrate when thinking about conditions in the labour market.
- Underemployment occurs when people are employed, but would like and are available towork more hours. There are two categories of underemployed people defined by the ABS.First, part-time workers who would prefer to work additional hours. Second, people whousually work full time, but are currently working part-time hours. Underemployment rates aregenerally higher among groups that have a larger proportion of people working part time, such asfemales, younger workers and older workers.
- Hidden unemployment occurs when people are not counted as unemployed in the formalABS labour market statistics, but would probably work if they had the chance. For example,someone might have looked for work for a long time, given up hope and stopped looking, butstill wish to work.
- Seasonal unemployment occurs at different points over the year because of seasonalpatterns that affect jobs. Some examples include ski instructors, fruit pickers andholiday-related jobs. The ABS publishes seasonally adjusted labour market statistics,which remove seasonal patterns in the data.
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Why The Unemployment Rate Matters
According to the U.S. Bureau of Labor Statistics , when workers are unemployed, their families lose wages, and the nation as a whole loses their contribution to the economy in terms of the goods or services that could have been produced.
Unemployed workers also lose their purchasing power, which can lead to unemployment for other workers, creating a cascading effect that ripples through the economy. In this way, unemployment even impacts those who are still employed.
When companies are trying to cut costs, they often reduce their workforce as one of their cost-saving measures. Those workers who are left to do more work after a company lays off part of their staff are not likely to receive any additional compensation for the extra hours they are working.
Unemployment can also have a negative effect on the mental state of those who are still employed. They may become more concerned about losing their jobs or be hesitant to search for other employment because they have a false belief that they “are lucky” to be employed at all. They may even feel guilty about having a job when their co-workers are out of work.
More broadly, high unemployment is also problematic for the U.S. economy. Over 70% of what the U.S. economy produces is purchased by domestic consumers through their personal consumption habits. Unemployed workers consume far less than those with a steady income because they have less discretionary income.
Unemployment Rates In Different Countries
Usually states with high living standards, stable political situations and developed economies have favorable economic indicators, including low unemployment. Of course, global financial crises, natural disasters, and some other factors can affect a country’s labor market and employment, but in general the richest nations on the planet have low unemployment.
Governments of some countries often manipulate official figures, so it is difficult to reliably determine the level of unemployment. It should be noted that high employment is not always an indication of the well-being of a country. It is the other way round. For example, today the unemployment rate in South Africa is over 30%, yet it is one of the richest countries in Africa.
Next, let’s highlight the lists of countries with the highest and lowest unemployment rates in 2022.
TOP 10 COUNTRIES WITH THE HIGHEST UNEMPLOYMENT IN 2022
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How Is The Unemployment Rate Measured
Unemployment occurs when someone is willingand able to work but does not have a paid job.The unemployment rate is the percentage ofpeople in the labour force who are unemployed.Consequently, measuring the unemployment raterequires identifying who is in the labour force.The labour force includes people who are eitheremployed or unemployed. Figuring out whois employed or unemployed involves makingpractical judgements, such as how much paidwork someone needs to undertake for them tobe considered as having a job, as well as actuallycounting how many people have jobs or not.
In Australia, the Australian Bureau of Statistics is responsible for collecting labour market data.The ABS conducts a survey each month called the Labour Force Survey in which it asks around50,000 people about their participation in the labour market. As part of this survey, the ABS groupspeople aged 15 years and over into three broad categories:
- Employed includes people who are in a paidjob for one hour or more in a week.
- Unemployed includes people who are not ina paid job, but who are actively looking for work.
- Not in the labour force includes people notin a paid job, and who are not looking for work.
This can include people who are studying, caring for children or familymembers on avoluntary basis, retired, or who are permanently unable to work.
Once the number of people in each of these categories has been estimated, the followinglabour market indicators can be calculated:
Formula To Calculate The Unemployment Rate
The unemployment rate formula calculates the share of people who are not working or are jobless of the total employed or unemployed labor force and is depicted as a percentage.
Unemployment Rate = Unemployed People / Labor Force * 100
You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be HyperlinkedFor eg:
- U is the Unemployment rate.
- The labor force consists of both employed and unemployed.
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The Unemployment Figures In Detail
The total number of unemployed is 6.9 million, down 542,000 from October. The number of long-term unemployed dropped to 2.19 million. A smaller number, 1.9 million, lost jobs within the last five weeks. This number declined from October’s 2.1 million.
The real unemployment rate was 7.8% in November, 0.5 percentage points lower than in October. This alternate measure of unemployment, known as U-6, gives a broader definition of unemployment. It includes people who would like a job but haven’t looked for one in the past month. It also includes those who are underemployed and marginally attached.
The real unemployment rate includes 450,000 discouraged workers, down from 455,000 in October and down from 657,000 back in Nov. 2020. Discouraged workers are people who have given up looking for work but would take a job if offered. They are not counted in the unemployment rate because they haven’t looked for a job in the past four weeks.
The labor force participation rate in November was 61.8%, up 0.2 percentage points from October. The labor force doesn’t include those who haven’t looked for a job in the past month. Some would like a job, but others dropped out of the labor force for different reasons. They may have retired, gone back to school, or had a baby.
The Challenge Of Comparing International Unemployment Rates
When evaluating the unemployment rates of countries in comparison with one another, it is vital to keep in mind that it is not always an apples-to-apples comparison. For starters, not every country has the same definition of unemploymentfor instance, some countries say that if a person is able to work but not currently employed, that person is unemployed. But other countries only consider a person unemployed if they are actively seeking work. People who are not working and not looking for work are not considered unemployed. Obviously, these different definitions will have an impact on the unemployment rates posted by those countries.
To see this impact in action, examine the 2019 unemployment rate in South Africa, using data from the International Labour Organization. According to the ILOSTAT database, Unemployment is 29% when filtered using all three criteria , 38% when filtered by “not employed but available” with no measure of looking, and a full 40% when filtered by “not employed but looking” with no availability requirement.
Fortunately, most countries currently report their unemployment according to an established international standard, which makes it easier to ensure apples-to-apples data comparisons. But the possibility of a mismatch still exists and can be a helpful thing to keep in mindespecially if you encounter data that seem surprising.
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Box: Calculating The Unemployment Rate An Example
To understand how the unemployment rate is calculated we can use an example. Inthis example 12.6 million people are employed and 0.7 million people are unemployed. The sizeof the labour force is calculated as the sum of these groups.
With the unemployment rate being the percentage of people in the labour forcewho are unemployed, using the numbers in our example and the equation below, theunemployment rate is calculated as 5.3 per cent.
The unemployment rate is affected by changes in the number of unemployed people, which can result from cyclical factors, such as the number of people who becomeunemployed because of an economic downturn, or more structural factors in the economy . The unemployment rate is also affected bychanges in the size of the labour force .
Unemployment Rate In The Oecd Area Stabilises At Pre
10 Mar 2022 – The monthly unemployment rate in the OECD area was stable at 5.3% in January 2022, the same rate that was recorded in February 2020 just before the pandemic and the lowest level since the start of the series in 2001. The number of unemployed workers in the OECD, at 35.9 million remained only 0.3 million above the pre-pandemic level.
In January, the OECD area unemployment rate for women declined to 5.5% , while it was stable among men at 5.2% . Nevertheless, just half of OECD countries reported a lower unemployment rate for men than women.
The OECD area youth unemployment rate increased to 11.3% in January 2022, from 11.2% in December.
In the euro area, the unemployment rate fell further in January, to 6.8% from 7.0% in December 2021, with declines of 0.2 percentage point or more in Estonia, France, Italy, Luxembourg, Slovenia and Spain and rises of 0.2 percentage point or more in Greece, Lithuania and Portugal . In the euro area, the youth unemployment rate fell to 13.9% from 14.2% in December, continuing its downward trend.
The unemployment rate in January fell by 0.3 percentage point in Mexico and by 0.2 percentage point in Israel and Korea, while it increased by 0.5 percentage point in Canada, 0.3 percentage point in Colombia, 0.2 percentage point in Denmark, and 0.1 percentage point in both Japan and the United States. More recent data show that in February 2022 the unemployment rate declined by 0.2 percentage point in the United States .
Relevance And Uses Of Unemployment Rate Formula
It is one of the most important indicators of the economic health of a nation. Although it is a lagging indicator, it provides a clear indication of the direction of the economy. Inherently, the unemployment rate is expected to increase when the economy is weak at which results in a scarcity of jobs. On the other hand, the unemployment rate is expected to fall when the economy is trending up. For instance, after the crisis of 2007-08, the unemployment in the US went up to 9.3% and 9.6% during 2008 and during 2009, which is one of the highest unemployment rates in the US during the last seven decades. As such, from the perspective of economists, the concept of the unemployment rate can be a good economic indicator.
Examples Of Unemployment Rate Formula
Lets take an example to understand the calculation of the Unemployment Rate in a better manner.
Unemployment Rate Formula Example #1
Let us take the example of the residents of the US to explain the concept of the unemployment rate. In the year 2018, around 155,761 thousand US residents were employed, while around 6,314 thousand were unemployed. Calculate the unemployment rate in the US for the year 2018 based on the given information.
The unemployment Rate is calculated using the formula given below
Unemployment Rate = No. of Unemployed Persons /
- Unemployment Rate = 6,314 /
- Unemployment Rate = 3.9%
Therefore, the unemployment rate in the US during the year 2018 stood at 3.9%.
Unemployment Rate Formula Example #2
Let us an example of a country to understand the other intricacies of the unemployment rate. Let us assume that the information pertaining to the employment status of the country is available as on December 31, 20XX.
Based on the given information, calculate the unemployment rate of the country as of December 31, 20XX.
No. of Unemployed Persons is calculated using the formula given below
No. of Unemployed Persons = Non-Institutionalized Civilian Population Volunteers Discouraged Workers Not Actively Seeking Jobs During Last 4 Weeks No of Employed Persons
- No. of Unemployed Persons = 1,500,000 50,000 170,000 40,000 1,150,000
- No. of Unemployed Persons = 90,000
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Box: Calculating The Participation Rate An Example
The participation rate expresses the labour force as a percentage of the working-agepopulation. The working-age population includes Australian residents aged 15 yearsand over .
Using the numbers in the example above there are 13.3 million people in the labourforce and, if the working-age population is 20.0 million people, the participation rate is 66.5per cent.
Labour force participation typically moves with the business cycle. Whenbusinesses are hiring more workers and offering higher wages, the incentives are greater toactively look for work. In contrast, when businesses are not hiring and offering smaller wageincreases, there is less of an incentive for people to look for work.
There are also structural influences affecting labour force participation thatare independent of the business cycle. Some examples of trends that have affected theparticipation rate in the past include: more opportunities to work part time an increase in thenumber of females looking for work and people working for longeras they delay their retirement.
Criticisms Of Measuring Unemployment
There are always complications in measuring the number of unemployed. For example, what about people who do not have jobs and would be available to work, but have gotten discouraged at the lack of available jobs in their area and stopped looking? Such people, and their families, may be suffering the pains of unemployment. But the survey counts them as out of the labor force because they are not actively looking for work. Other people may tell the Census Bureau that they are ready to work and looking for a job but, truly, they are not that eager to work and are not looking very hard at all. They are counted as unemployed, although they might more accurately be classified as out of the labor force. Still other people may have a job, perhaps doing something like yard work, child care, or cleaning houses, but are not reporting the income earned to the tax authorities. They may report being unemployed, when they actually are working.
Although the unemployment rate gets most of the public and media attention, economic researchers at the Bureau of Labor Statistics publish a wide array of surveys and reports that try to measure these kinds of issues and to develop a more nuanced and complete view of the labor market. It is not exactly a hot news flash that economic statistics are imperfect. Even imperfect measures like the unemployment rate, however, can still be quite informative, when interpreted knowledgeably and sensibly.
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Difference Between The Unemployment And Jobs Reports
The unemployment rate and figures from the jobs report don’t always tell the same story because they are taken from two different surveys.
The unemployment rate is taken from the household survey of individuals. It describes who is employed and who isn’t based on their responses.
The number of jobs added is taken from the establishment report, more commonly called the nonfarm payroll report. This survey of businesses describes how many jobs were created or lost by industry.
The number of unemployed doesn’t match the number of jobs lost because these reports are taken from completely different sources. Those discrepancies are expected, and the estimates are revised each month as more data comes in.