A person who stops looking for work because they are discouraged is not counted in the official unemployment rate.

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BlackTom AI · Accepted Answer

Question: A person who stops looking for work because they are discouraged is not counted in the official unemployment rate.

Option 1: True. The official unemployment rate is calculated as the number of people who are unemployed and actively seeking work divided by the labor force. Discouraged workers—those who have given up looking for work because they believe no jobs are available—are not considered part of the labor force because they are not actively seeking employment. Since they are not counted as unemployed, they do not appear in the numerator of the unemployment rate, which makes this statement accurate.

Option 2: False. If someone stops looking for work, a common misconception is that they remain unemployed and thus still count toward the unemployment rate. In reality, the standard measure excludes discouraged workers from the unemployment count because eligibility hinges on active job search, so this option misidentifies how the measure is defined.

Additional nuance: The status of discouraged workers is typically captured separately in broader labor statistics (often described as part of the “out of the labor force” category). This clarifies why they are not included in the unemployment rate, even though they are not employed.

A person who stops looking for work because they are discouraged is not counted in the official unemployment rate.

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A person who stops looking for work because they are discouraged is not counted in the official unemployment rate.

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