what is the employment to population ratio 
the employment to population ratio also known as the employment population ratio is a macroeconomic statistic that measures the civilian labor force currently employed against the total working age population of a region municipality or country it is viewed as a broad metric of labor unemployment it is often calculated by dividing the number of people employed by the total number of people of working age understanding the employment to population ratiocompared with other measures of labor force participation the employment to population ratio is not as affected by seasonal variations or short term fluctuations in the labor market as a result it is often considered to be a more reliable indicator of job shrinkage or growth than the unemployment rate if 50 million people are employed in an area with 75 million people of working age the employment to population ratio is 66 7 the calculation is as follows labor force employedtotal population frac text labor force employed text total population total populationlabor force employed this measure is similar to the labor force participation rate which measures the total labor force and not just the part of the labor force already employed like the unemployment rate does divided by the total population the civilian labor force is a term used by the u s bureau of labor statistics bls to refer to americans who are considered either employed or unemployed those not included in the labor force count include military personnel federal government employees retirees handicapped or discouraged workers and some agricultural workers many economists use the total working age population in the denominator but the official measure of the employment to population ratio measured by the bls uses the noninstitutional civilian population which excludes the following 1disadvantages of the employment to population ratiothe employment to population ratio does not include the institutionalized population such as people in mental hospitals and prisons or people in school who are studying for a career it also doesn t take into account underground market labor the employment to population ratio also fails to account for people who are over or under the working age but are still working such as babysitters child actors or moonlighting retirees these workers may be counted in the employed side of the ratio but may not be included in the total number of people of working age as a result their employment inaccurately increases the ratio the employment to population ratio does not take hours worked into account so it fails to distinguish between part time and full time workers the employment to population ratio vs the unemployment rateunsurprisingly based on the characteristics outlined above the employment to population ratio does not directly relate to the unemployment rate for example in february 2020 the employment to population ratio was 61 1 but the unemployment rate was only 3 5 23 together these numbers only account for 64 6 of the population this necessarily raises the question of what happened to the remaining third of the population the largest discrepancy between these two numbers exists because the unemployment figure does not indicate the number of people without employment people who want a job but have given up on their quest to find one are not included in the nation s unemployment number the unemployment rate usually only indicates the number of unemployed people who are actively looking for jobs it also does not include those who have exhausted their unemployment benefits which may artificially inflate the employment to population ratio people who have retired early and those who have decided to go back to school to further their job prospects are not taken into account in the unemployment figure however their absence from the workforce is accounted for in the employment to population ratio additionally while the e p attempts to quantify employment numbers it fails to qualify the nature of that number that means that if 100 000 people with graduate degrees and decades of work experience were laid off from jobs paying 200k per year and were then rehired to stock the shelves at a national supermarket chain for 15k per year the employment to population ratio would look stable even though the economic impact would be devastating 