The unemployment rate for the class

Official definition of the labor force, unemployment and unemployment rate; issues of accuracy in the unemployment rate

Appropriate for an introductory macroeconomics course.

Make a copy of the following survey questions. Remind students not to put their name on the form. Collect the forms and either tally them yourself for use the next class meeting, or redistribute the forms and poll the class about the responses on the survey form they received.

Survey (Microsoft Word 20kB Jul28 12)

Use the following form for students to keep track of the survey results and then to use this data to compute the class unemployment rate. Follow-up questions raise issues in the accuracy of this unemployment rate including: respondents who claim to be unemployed when they are not seeking work; respondents who want work but have withdrawn from the labor force (discouraged workers); and respondents working part-time who desire full-time work (underemployed).

Survey results; unemployment rate calculation; follow-up questions (Microsoft Word 22kB Jul28 12)

The following steps are recommended:

1. Ask students to estimate the unemployment rate for students in this class. This might be done in the context of data on the current US employment rate, including the rate for teenagers, men, women, and race and ethnic groups. This prediction step could be done with clickers, or as a survey in which students submit a written estimate, or to be more expedient, vote by raising hands for categories of rates ranging from 0% to 25%.

After students make their predictions, ask for explanations why their predictions were higher/lower than the current US rate.

2. Distribute the confidential survey based on the actual Current Population Survey questions. Note that the survey doesn't ask directly about unemployment, for which a positive response might be considered socially undesirable by some respondents. Instead, the survey asks about behavior such as looking for a job that is socially acceptable. Make certain that students end the survey at the points marked "end of survey. In other words, if a respondent is employed, then that respondent is not asked about seeking a job, nor if they are a student etc.

3. Collect the forms. As described above, either tally the results yourself for use in the next class meeting, or distribute them at random and ask students to report based on the form they receive (not their own answer). Tally the answers using the form listed above.

4. Ask students, preferably working pairs (see Starting Point module on cooperative learning) to calculate the unemployment rate and answer the follow-up questions. Students may need assistance or referral to the textbook if they do not know the definition of the labor force and the unemployment rate.

Students can be asked to explain why the class unemployment rate differed from the US rate.

Students can be asked to evaluate the official unemployment rate and compare it with the availability of alternative unemployment measures from the Bureau of Labor Statistics (U- 1 - U - 6)

On unemployment measurement see U.S. Bureau of Labor Statistics

See discussion of unemployment rates in chapter 9, "Labor Statistics," The Data Game: Controversies in Social Science Statistics