Which measure reflects the portion of the labor force that is unemployed and seeking work?

• A. Unemployment rate
• B. Inflation rate
• C. GDP
• D. Economic indicators

Answer: (A)

Unemployment rate measures the share of people in the labor force who are without a job but are actively looking for work. The labor force includes both those who are employed and those who are unemployed but seeking work, while people not seeking work aren’t counted. The rate is calculated by dividing the number of unemployed by the labor force and multiplying by 100. This directly captures how many people who want to work are actively trying to find a job, signaling the tightness or slack in the labor market.

Inflation rate tracks how prices rise over time, not job status. GDP measures overall economic output, not the share of people seeking work. “Economic indicators” is a broad category that can include many metrics, but isn’t a single specific measure of unemployment.