Question

What are some of the problems with measuring the unemployment rate? What is the Establishment Survey and is it effective?

Answer 1

The problems with measuring unemployment rate are :

• The unempolyment rate does not account fr the workers who are discouraged.
• It is not easy to capture long term unemployment rates and people not working for last 3-4 months are not considered long term unemployed.
• Part time and full time workers are not seperated which is another problem that exists.
• People with low paying jobs and underemployed are not taken into consideration.
• People who doesn't look for work or are marginally attached are also not taken into consideration.

Establishment survey measures the structure, output and business of an establishment rather than individuals and is much more effective than individual surveys for mesuring unemployment.