How to Use Labor Force Participation Rate Calculator

Enter the Labor Force.

Enter the Civilian Non-Institutionalized Population

Labor Force Participation Rate Calculator


How to calculate Labor Force Participation Rate

Labor force participation rate formula: Labor Force/Working age non-Institutionalized population.

Labor force = unemployed people + employed people. Lets say we have a labor force of 100,000 with 90,000 being employed and 10,000 unemployed and the non-institutionalized population is 210,000.

To calculate the particpation rate: 100,000/210,000 = 0.47619047619.

To clean up : 0.47619047619 * 100 = 47.61.

Definition: Labor force participation rate is the percentage of how many people are available to work in a given population.

The working-age non-institutionalized population is everyone who is employed or unemployed, that are persons aged 16 years old or older. Unemployed people are people searching for a job in the last four weeks and were available but could not obtain a job. While employed people can work for an employer or are self-employed.

The labor force participation rate is used to assess the working-age population in an economy. It is often looking at when an economy is not growing or in a recession. Generally, if an economy is in a recession the participation rate goes down with it as if the economy is struggling there are fewer jobs available. This leads to people being discouraged in searching for a job.

Population density can affect the labor force participation rate, there are many economists that have studied cities and find that workers in a high-density area earn higher wages and are more productive. There is an article on NYtimes arguing for more density in cities. Population density can vary greatly from area to area with cities having a higher density then towns or villages in the countryside, we have a Population Density Calculator where you can calculate the population density of an area.

Discouraged worked are not included in the participation rate. When the participation rate is high it is a good sign for the economy, if it is low it can serve as a warning for the economy. If you are interested in calculating the unemployment ratio for a specific population you can use our unemployment rate calculator.