Question

Refer to the table below: Year Unemployment Rate Labor Force (in thousands) 2000 4.0 142,583,000 2001 4.7 143,734,000 2002 5.8 144,863,000 2003 6.0 146,510,000 2004 5.5 149,401,000 2005 5.1 149,320,000 2006 4.6 151,428,000 2007 4.6 153,124,000 2008 5.8 154,287,000 2009 9.3 154,142,000 2010 9.6 153,889,000 2011 8.5 153,617,000 2012 7.9 154,995,000 2013 6.7 155,389,000 2014 6.2 155,922,000 2015 5.3 157,130,000 2016 4.9 159,187,000 Instructions: In part a, enter your response rounded to one decimal place. In part b, enter your response as a whole number. a. What was the unemployment rate in 2015? 5.3 % b. How many more jobs were needed to bring the unemployment rate down to the 4 percent low-end of the full-employment threshold in 2015?

Answer 1

Part 1) For the year 2015, the unemployment rate is 5.3%

Part 2) Unemployment Rate = {(Total Unemployed) ÷ (Labor Force)} × 100

For unemployment rate of 5.3% total unemployed are

5.3 = {(Total Unemployed) ÷ 157,130,000} × 100

Total unemployed when unemployment rate is 5.3% = 8,327,890

For unemployment rate of 4% total unemployed are

4 = {(Total Unemployed) ÷ 157,130,000} × 100

Total unemployed when unemployment rate is 4% = 6,285,200

For the unemployment rate to decline from 5.3% to 4% total unemployed should decline by 8,327,890 – 6,285,200 = 2,042,690, or in other words 2,042,690 jobs are needed to bring the unemployment rate down to the 4 percent low-end of the full-employment threshold in 2015.