Participation rate
The share of the working-age population in the labour force. A fall can flatter the unemployment rate, because people who give up looking stop being counted as unemployed.
Where you will meet it
Participation rate appears in 2 learning outcomes on the CFA syllabus. A few of them:
- Read unemployment measures and say what they show
“The participation rate is the share of the working-age population in that force.”
- Explain how immigration, demographics and labour force participation shape how fast and how sustainably an economy grows
“Combining population and participation, the labour force grows at g = (1 + working-age population growth) × (new participation rate ÷ old rate) − 1.”
See also
Practise it
Practise participation rate until it is automatic: questions that explain every wrong option.
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