when they say the unemplyment number is such and such or the weekly numbers Don't include those NOT looking for work. how is that done,what do they mean by "people not looking for work" and how is that factored into the numbers? thank you
Continuing Jobless Claims: number of individuals who are unemployed and are currently receiving unemployment benefits. Initial Jobless Claims: number of individuals who have filed for unemployment benefits for the first time. To file a claim you must be eligible and satisfy five criteria: 1) Meet the requirements of time worked during a 1yr period (full- or part-time); 2) Become unemployed through no fault of your own (not fired); 3) Must be able to work (no physical or mental impediment to employment); 4) Must be available for work; 5) Must be actively seeking work. Does that make sense?
what does it mean when someone drops out of the work force? how do they know when someone drops out of the work force?
Well, just think about the definitions above... If a) your unemployment benefits have run out; b) you don't satisfy one of the five criteria, e.g. you have stopped looking for work; you're officially not accounted for in either category. Make sense?
yes,i understand but how does the government know how many people drop out of the work force? is this why some people assert that the unemployment rate can be much higher than is stated?
so even if you are collecting unemplyment for a year, after 6 months you are no longer counted in the labor pool?
That was the last change in the methodology behind unemployment. It was 9 months, now it's 6 months. By the way, when you get unemployment benefits, it is originally set at 6 months and you simply renew it once the time comes. If you're looking to get a gauge on real unemployment, it's about 20% and growing if it was calculated in the same manner it was back during the 1930s.
You can take a look here for the various official measures of unemployment (U1 to U6): http://www.bls.gov/news.release/empsit.t12.htm