Employment Rate: Aged 25-54: All Persons for the United States And Something About GDP

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers.

We could look at the employment to population ratio. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading.

But we have this ratio for people age 25-54 (which also eliminates college age people who might not be looking for work). To see this chart Click on the link from the Federal Reserve Bank of St. Louis.




They have the data up to March of this year, when 77.21% of those 25-54 year were employed. It was 79.81% in December of 2007, when the recession started. It probably has come up since March, but is still likely below 79.81%. Notice that it dropped quite a bit as a result of the recession but it has been coming back up the last few years.

Now to GDP. In Macro, I talked about Simon Kuznets. Click here to see some info about him from nobelprize.org. It mentions that he was born in what is now Belarus. Here is some info about his contributions that led to his Nobel Prize in economics:

"Extensive research on the economic growth of nations, developed methods for calculating the size of, and changes in, national income."