Labor force
Definition
The labor force refers to the total number of people who are employed or actively seeking employment. It includes both employed individuals and those who are unemployed but looking for work.
Analogy
Imagine a big pool party where everyone is either swimming or waiting by the poolside ready to jump in. The people swimming represent those who are currently employed while those waiting by the poolside symbolize those who are unemployed but actively searching for jobs - together they form the labor force.
Related terms
Unemployment rate: Measures the percentage of people in the labor force who are unemployed.
Full employment: Occurs when there is no cyclical unemployment present in an economy.
Underemployment: Describes a situation where workers have jobs that do not fully utilize their skills or qualifications.
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