What is the Labor Force?

Definition: The labor force, also called work force, is the population of able-bodied, willing people who are currently employed or looking for work. In other words, it’s a representation of the labor pool of a certain country or segment of the economy.

What Does Labor Force Mean?

What is the definition of labor force? The concept of the labor force is mainly used by economists and financial professionals throughout the world to determine the health and status of an economy.

Economists also study the population and aging trends to guide fiscal policy. For example, the retired populations are slowly outgrowing the current work force in the US due to a decreased birth rate in recent generations. Thus, the baby boomers are slowly leaving the workplace and starting to collect social security. This is a growing problem represents the importance of a growing national work force.

Let’s look at an example.


Jessica is an economics student at the University of Michigan and wants to check the accuracy of the Bureau of Economic Analysis’s work force numbers. In order to do that, she must find several figures: the number of workers that are currently employed in all industries in the United States, as well as those individuals who may have looked for work in the past 12 months, or “marginally attached” individuals. In order to do this, she decides to dig through Census data, as well as send out surveys to a representative population of 50,000 around the United States.

She finds that throughout the United States, there are 20,000,000 people currently employed. In contrast, since it is a bustling economic time, those that have looked for a job in the past month, according to her survey, are about 35% of all non-employed people. Since the working-age population is only 40,000,000 and 20,000,00 are non-employed, this creates an additional .35 x 20,000,000 = 7,000,000 people.

This creates a total work force of 20,000,000 + 7,000,000 = 27,000,000 people that are included in the work force of the United States. Although this is a simple calculation, real-world economists must deal with many more variables and people, which makes the calculation very difficult, especially due to the ambiguity of those who are marginally attached.

Summary Definition

Define Labor Force: Labor force means the segment of a population who are employed or currently looking for employment.

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