Participation Rate
Definition of 'Participation Rate'A measure of the active portion of an economy's labor force. The participation rate refers to the number of people who are either employed or are actively looking for work. The number of people who are no longer actively searching for work would not be included in the participation rate. During an economic recession, many workers often get discouraged and stop looking for employment, as a result, the participation rate decreases. |
|
Investopedia explains 'Participation Rate'The participation rate is an important metric to note when looking at unemployment data because unemployment figures reflect the number of people who are looking for jobs but are unable to secure employment.The participation rate is important in analyzing the unemployment rate. Those who have no interest in working are not included in the participation rate but are included in the unemployment rate. An aging population can have both a positive and negative effect on the participation rate, through retirement and new people entering the workforce. The participation rate and unemployment data should be observed in tandem to give a better understanding of the overall employment status. |
Related Definitions
Articles Of Interest
-
Explaining The World Through Macroeconomic Analysis
From unemployment and inflation to government policy, learn what macroeconomics measures and how it affects everyone. -
Jobless Growth: Are You Prepared?
Economic growth doesn't always mean employment growth. Learn about how the jobless growth economy affects workers and investors. -
What You Need To Know About The Employment Report
This widely watched indicator of economic well-being also directly influences the market. -
What Is Fiscal Policy?
Learn how governments adjust taxes and government spending to moderate the economy. -
Quants: The Rocket Scientists Of Wall Street
Blend math, finance and computer skills to command a high - and well deserved - salary. -
Introduction To The Continuing Claims Report
This weekly economic release contains important information concerning unemployment levels and insurance. -
Trading The Non-Farm Payroll Report
Discover how to trade the NFP report without getting knocked out by the irrational volatility it can create. -
Economic Indicators That Affect The U.S. Stock Market
Macroeconomic factors like GDP, Inflation, and Retail Sales affect the value of your portfolio. Understanding these economic indicators is vital for every investor in the marketplace. -
Calculating The Means
Learn more about the different ways you can calculate your portfolio's average return. -
R-Squared
Learn more about this statistical measurement used to represent movement between a security and its benchmark.
Free Annual Reports