The unemployment rate is a key measure of joblessness in the United States. It’s calculated by the Bureau of Labor Statistics through a monthly survey. It’s based on a sample of 60,000 eligible households. The U-3 unemployment rate is the most widely cited, which counts only people who have lost jobs and are actively looking for work. But other measures (U-1 through U-6) offer a more complete picture of the job market and economy.
The number of people who have lost a job and are searching for one fluctuates with the business cycle. Typically, when the economy is growing, more people find work and the unemployment rate falls. But a recession can bring on more job losses and an increase in the unemployment rate. People may leave the workforce because they are retiring, unable to work due to health or caregiving issues, or have simply become discouraged and stopped looking for employment altogether.
Whether the unemployment rate is rising or falling, it has important implications for families. Economic instability can strain parents’ relationships and cause children to suffer. Across all family types, stability is lower in households with unemployed parents.
There are many causes of unemployment, including recessions, technological improvements, and outsourcing. But public policies can also influence the willingness of workers to seek employment and the ability of businesses to hire. For this reason, it’s important to understand the factors that influence unemployment rates and the ways they change over time.
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