You cannot turn on the news without hearing about the unemployment rate and its historic lows. The official unemployment in the US is defined as "the total unemployed as a percent of the civilian labor force" (Mankiw, 2018). But what does this number mean? Who are the unemployed? What is the civilian labor force?

Every month, the Bureau of Labor Statistics (BLS) collects numbers on how many people are employed, those persons who have jobs, and the unemployed. The two key statistics are U3 or official unemployment rate and U6 or "real" unemployment rate. The BLS classifies the unemployed as those not employed but are actively looking and are able to work. As of May 2019, the U3 rate is 3.6% with a U6 rate of 7.1% ("Table A-15. Alternative measures of labor underutilization", 2019).

The U3 rate is well below the natural unemployment rate of 4% ("Natural rate of unemployment", 2019) however, when analyzing unemployment, we need the labor participation rate to get a true picture. Furthermore, according to the Khan Academy video, it "doesn't capture those exiting or entering the labor force, therefore U3 can make unemployment look better or worse than it actually is" ("Unemployment rate primer | Current Economics | Finance & Capital Markets | Khan Academy", 2019).

This is where another important BLS statistic come into play; the labor force participation rate, which is currently at 62.8% . Thisrate is that percentage of the population that haschosento work. Thekey is that the participation rate must be studied in relation totheunemployment ratein order to get a clear picture of unemploymentbecause "people classified as unemployed ...might not be active participants of the workforce".("What is the Labor Force Participation Rate?", 2019). We can now see that the U3 rate is not as impressive as it seems since it only calculates that marginal amount of the workforce.

This is where the U6, the "real" unemployment rate is a more determinant number. U6 expands on the U3 by including workers employed part time. those not working nor looking for work but are willing and available to work (marginally attached) and those who have just given up on finding a job (discouraged workers). With these added participants, the BLS calculates the real unemployment rate at almost double the U3, a more accurate number of unemployment.

WC= 476

Mankiw, G. N. (2018).Principles of economics.Boston, MA: Cengage Learning.

Table A-15. Alternative measures of labor underutilization. (2020). Retrieved fromhttps://www.bls.gov/news.release/empsit.t15.htm

Natural rate of unemployment. (2020). Retrieved fromhttps://en.wikipedia.org/wiki/Natural_rate_of_unemployment

Unemployment rate primer | Current Economics | Finance & Capital Markets | Khan Academy. (2020). Retrieved fromhttps://youtu.be/C9onjpQGpSg

Civilian labor force participation rate. (2020). Retrieved fromhttps://www.bls.gov/charts/employment-situation/civilian-labor-force-participation-rate.htm

What is the Labor Force Participation Rate? (2020). Retrieved fromhttps://www.investopedia.com/terms/p/participationrate.asp

U3 vs. U6 Unemployment Rate: What's the Difference? (2020). Retrieved fromhttps://www.investopedia.com/articles/investing/080415/true-unemployment-rate-u6-vs-u3.asp

***This was my discussion, but could you help me finding an answer for the comment of my professor.***

Professor comment "If you had the data as requested, you would know that your first sentence:"You cannot turn on the news without hearing about the unemployment rate and its historic lows." is inaccurate. That clearly comes from somewhere and needs to be in quotes."