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Labor Market Related Terms
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Home » Labor Market Related Terms
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Labor Market: A labor market is defined as a pool of all potential workers who compete for jobs. It also includes the employers who compete for workers. Labor markets are based on the supply and demand of labor in a country or a specific location that are able and willing to work.
Labor Force: Labor force includes all persons classified either as employed or unemployed during a specified period of time, usually a day or a week. Labor force can be categorized as self-employed, wage and salary earners, casual workers and unemployed.
Casual Workers: Casual workers are those workers who are generally employed
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by small entrepreneurs on daily or weekly basis on a low wage rate. They are not entitled to any paid holiday leave or paid sick leaves.
Unemployed persons: The persons in the labor market who are without work, that is, without paid employment or self-employment and are currently either available for work or are seeking any work are considered to be unemployed.
Labor force participation rate: It is the number of persons in the labor force as a percentage of the working-age population. The working-age population is the population above a certain reference age like15 years old and over or 15–64, etc.
Employment rate: It is ratio of employed persons to the total labor force. It is the percentage of working age people who have jobs or are employed.
Unemployment rate: It is the ratio of unemployed people to the total labor force.
Underemployed persons: Workers who are employed, but not in the desired capacity, whether in terms of compensation, hours, or level of skill and experience. The skills of such persons are underutilized, for example paying low wages to a highly skilled employee. Underemployment also refers to a situation where a major portion of labor force is unemployed.
Underemployment rate: It is the ratio of underemployed to either total labor force or total employment.
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