labourforce

The labour force is the group of people who are available for work and are either employed or actively seeking employment. It typically excludes those not seeking work, such as students, retirees, or those unable to work. The size and characteristics of the labour force are central to assessing an economy’s level of activity and potential output.

In statistical practice, the labour force is measured through standard surveys. Working-age populations are defined differently by country, commonly between ages 15 and 64 or 15 and 74. Key indicators derived from the labour force include the unemployment rate (the share of the labour force that is unemployed), the employment rate (the share of the working-age population that is employed), and the labour force participation rate (the labour force as a proportion of the working-age population). The distinction between unemployed and those not in the labour force is important for interpreting economic conditions.

The labour force level and its composition influence policy decisions on unemployment benefits, education, and retirement. Demographic trends, aging, immigration, and participation incentives affect both current employment and potential growth. Changes in the labour force can alter wage dynamics and inflation pressures even when aggregate demand is stable.

Terminology varies by region and spelling, with “labour force” common in British English and many Commonwealth contexts and “labor force” used in American English. Data are produced by national statistical offices and international bodies such as the OECD and the ILO. Limitations include survey nonresponse, measurement of underemployment, and discouraged workers who have exited the labour force.