### ECO 202 Cram Kit Bundle

Unemployment
Types of Unemployment
Unemployment Measures
Okun’s Law
Misery Index
Economic Measures
Consumer Price Index (CPI)
Gross Domestic Product (GDP)
Gross National Product (GNP)
Potential Output
Money Supply
Stock vs. Flow
Economic Models
Supply & Demand
Aggregate Supply & Aggregate Demand
Economic Gaps
Interest Rates
Interest Rates
Loanable Funds
Comprehensive

# Discouraged workers

A discouraged worker is someone who is eligible for employment and can work but has given up looking for work. They are not in the labor force.

Because discouraged workers are not looking for work, they are nonparticipants in the labor market. Therefore, discouraged workers are NOT counted as unemployed or as a part of the labor force when calculating unemployment.

## How to calculate discouraged workers

Situation: Crammerville's population is 120, containing 5 children. The labor force 100 has workers: 90 of which are working, 2 just quit their jobs, 1 was just fired, 1 recently entered the labor market, 4 were laid off because the economy was bad, and 2 have been unemployed for 5 years because they have no marketable skills. The remaining people of Crammerville who are not in the labor force wish they had a job, but have given up looking.

We can find the number of discouraged workers in with the following formula:

Discouraged workers = Population - Labor Force - Children

We can pinpoint our population here...

Situation: Crammerville's population is 120, containing 5 children. The labor force 100 has workers: 90 of which are working, 2 just quit their jobs, 1 was just fired, 1 recently entered the labor market, 4 were laid off because the economy was bad, and 2 have been unemployed for 5 years because they have no marketable skills. The remaining people of Crammerville who are not in the labor force wish they had a job, but have given up looking.

...which can be plugged in like so:

Discouraged workers = Population - Labor Force - Children
Discouraged workers = 120 - Labor Force - Children

We can pinpoint the Labor Force here...

Situation: Crammerville's population is 120, containing 5 children. The labor force 100 has workers: 90 of which are working, 2 just quit their jobs, 1 was just fired, 1 recently entered the labor market, 4 were laid off because the economy was bad, and 2 have been unemployed for 5 years because they have no marketable skills. The remaining people of Crammerville who are not in the labor force wish they had a job, but have given up looking.

...which can be plugged in like so:

Discouraged workers = Population - Labor Force - Children
Discouraged workers = 120 - 100 - Children

We can pinpoint the Population ≥ 16 yrs old here...

Situation: Crammerville's population is 120, containing 5 children. The labor force 100 has workers: 90 of which are working, 2 just quit their jobs, 1 was just fired, 1 recently entered the labor market, 4 were laid off because the economy was bad, and 2 have been unemployed for 5 years because they have no marketable skills. The remaining people of Crammerville who are not in the labor force wish they had a job, but have given up looking.

...which can be plugged in like so:

Discouraged workers = Population - Labor Force - Children
Discouraged workers = 120 - 100 - 5

Discouraged workers = Population - Labor Force - Children
Discouraged workers = 120 - 100 - 5

When we solve, this results in 15 discouraged workers!

Discouraged workers = Population - Labor Force - Children
Discouraged workers = 120 - 100 - 5
Discouraged workers = 15

To be clear, these discouraged workers are related to this part of the prompt:

Situation: Crammerville's population is 120, containing 5 children. The labor force 100 has workers: 90 of which are working, 2 just quit their jobs, 1 was just fired, 1 recently entered the labor market, 4 were laid off because the economy was bad, and 2 have been unemployed for 5 years because they have no marketable skills. The remaining people of Crammerville who are not in the labor force wish they had a job, but have given up looking.