4.19: Discouraged Workers

Labor force statistics typically divide the working-age population into three groups: those who are employed, those who are unemployed, and those not participating in the labor force.

In the U.S., the Current Population Survey (CPS) is a monthly survey conducted by the U.S. Census Bureau and the Bureau of Labor Statistics. This survey categorizes the civilian noninstitutional population aged 16 and older into three mutually exclusive groups: employed, unemployed, and not in the labor force. Among those not in the labor force, the CPS identifies a subgroup known as discouraged workers.

Discouraged workers are individuals who are ready to work and are available to work but are not classified as unemployed because they have not actively searched for work within the four weeks ending with the survey reference week. Although these individuals have sought employment within the past 12 months, their lack of recent job search activity places them as discouraged workers according to CPS definitions.

A few reasons reported by discouraged workers for not actively seeking employment include a perceived lack of suitable job opportunities, a mismatch between available jobs and their qualifications or experience, and repeated unsuccessful attempts to gain employment.

Understanding the characteristics and motivations of discouraged workers is essential for developing targeted labor market policies. Interventions may include skills training, improved job matching services, and enhanced unemployment support mechanisms. By addressing the root causes of discouragement, policymakers can promote labor force reentry.

Labor force statistics usually group the working-age population into three categories: employed, unemployed, and not in the labor force.

The category "not in the labor force" includes a subgroup known as discouraged workers.

Discouraged workers are individuals who want a job but are not actively seeking one.

Countries may differ in how they define or measure this group.

Consider the United States, where, under the Current Population Survey or CPS rules, discouraged workers are individuals who looked for a job within the past twelve months but not during the last four weeks.

The reasons they give for not searching recently include believing that no jobs are available, that the available jobs do not match their qualifications, or that they have repeatedly failed in previous job applications, among other reasons.

Although they are ready to work, discouraged workers do not have jobs, indicating a form of underutilization.

Understanding why workers become discouraged helps policymakers design better strategies to encourage renewed job-seeking.