Monitoring Jobs and Inflation
Employment and Unemployment
• Every month, Statistics Canada surveys 54,000 households to track the state of the nation’s
• This survey is called the Labour Force Survey.
• The working-age population is the total number of people aged 15 years and over.
• The working-age population divides into two groups: those in the labour force and those not in
the labour force.
• The labour force is split into two groups: the employed and the unemployed.
• A person is employed if they have either a full-time job or a part-time job.
• A person is unemployed if they are in one of the following categories:
o Without work but has made specific efforts to find a job within the previous four weeks.
o Waiting to be called back to a job from which he or she has been laid off
o Waiting to start a new job within four weeks
• Statistics Canada calculates four labour market indicators:
o The unemployment rate
o The involuntary part-time rate
o The labour force participation rate
o The employment-to-population ratio
• The unemployment rate is the percentage of the people in the labour force who are
• Unemployment rate = (Number of people unemployed ÷Labour force) x 100
• The involuntary part-time rate is the percentage of people in the labour force who have part-
time jobs and want full-time jobs.
• Involuntary part-time rate = (Number of involuntary part-time workers ÷ Labour force) x 100
• The labour force participation rateis the percentage of the working-age population who are
members of the labour force.
• Labour force participation rate = (Labour force ÷ Working-age population) x 100
• The employment-to-population ratio is the percentage of the working-age population who have
• Employment-to-population ratio = (Number of people employed ÷ Working-age population) x
• The labour force participation rate and the employment-to-population rate show upward
• The unemployment rate increases in recessions and decreases in expansions.
• The upward trends in the labour force participation rate and the employment-to-population
ratio are accounted for mainly by the increasing participation of women in the labour market. Two types of labour are excluded from the official unemployment measure:
o Marginally attached workers
o Part-time workers who want full-time jobs
• A marginally attached worker is a person who currently is neither working nor looking for a job
but has indicated that he or she wants and is available for a job and has looked for work
sometime in the recent past.
• A discouraged worker is a marginally attached worker who has stopped looking for a job
because of repeated failure to find one.
Unemployment and Full Employment
• Unemployment is classified into three types:
• Frictional unemployment is the unemployment that arises from normal labour market tur