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Measuring Labor Utilization: The Non-Employment Index

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  • Marianna Kudlyak

Abstract

The elevated number of non-employed people who are out of the labor force has raised some concerns about how well the headline unemployment rate measures available labor. An alternative measure of labor utilization, the Non-Employment Index, accounts for all non-employed individuals, distinguishing between groups like short-term versus long-term unemployed, discouraged workers, retirees, and disabled individuals, and adjusting for how likely each is to transition to employment. Current data show the index is very close to its value in 2005?06, the period near the peak of the previous economic expansion.

Suggested Citation

  • Marianna Kudlyak, 2017. "Measuring Labor Utilization: The Non-Employment Index," FRBSF Economic Letter, Federal Reserve Bank of San Francisco.
    • Handle: RePEc:fip:fedfel:00123
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    References listed on IDEAS

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    1. Kudlyak, Marianna & Lange, Fabian, 2014. "Measuring Heterogeneity in Job Finding Rates Among the Nonemployed Using Labor Force Status Histories," IZA Discussion Papers 8663, Institute of Labor Economics (IZA).
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    Cited by:

    1. Bobeica, Elena & Koester, Gerrit & Lis, Eliza & Nickel, Christiane & Porqueddu, Mario, 2019. "Understanding low wage growth in the euro area and European countries," Occasional Paper Series 232, European Central Bank.
    2. Byrne, Stephen & Conefrey, Thomas, 2017. "A Non-Employment Index for Ireland," Economic Letters 09/EL/17, Central Bank of Ireland.

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