Unemployment rate or employment rate, which is the most relevant indicator?

THE ECO SCAN – The employment rate, which receives little media coverage, provides an indication of a country’s capacity to mobilize its human resources for the production of goods and services.

The number of job seekers registered with Pôle emploi, all categories combined, was close to 6 million (5,997,800) in mainland France at the end of April 2015 and amounted to 6.3 million in France over the same period. The figure swells further from the.

In France, we use to calculate unemployment: the unemployment rate within the meaning of the International Labor Office calculated by the National Institute of Statistics and Economic Studies (Insee) and the number of job seekers (we do not speak unemployed) registered with Pôle emploi. The trends are similar, although the calculation methods are different.

“There is a more relevant indicator: the employment rate”, launches André Zylberberg, French economist, labor market specialist and emeritus research director at the CNRS. Indeed, “this gives a good indication of the productive potential of a country, since it measures the human capacities mobilized for the production of goods and services. For its part, the unemployment rate is more an indicator of the imbalance in the labor market. It must be considered as complementary to the employment rate, ”he adds.

According to the, the employment rate expresses the capacity of productive structures to mobilize manpower resources. Raising the employment rate increases the production of wealth per capita and promotes the social inclusion of populations. “The employment rate of a class of individuals is calculated by dividing the number of individuals of the class having a job to the total number of individuals in the class. It can be calculated on the entire population of a country, but we are most often limited to the population of working age (people aged 15 to 64) ”summarizes INSEE.

“There are always ambiguities about what it means to ‘look for a job’. On the other hand, “having a job”, even part-time, is much less ambiguous ”

André Zylberberg, economist, labor market specialist

For its part, the unemployment rate measures the ratio between the number of unemployed and the number of individuals in the active population. “By definition, an unemployed person is a person looking for work, unlike an inactive. However, there are always ambiguities about what it means to “look for a job”. On the other hand, “having a job”, even part-time, is much less ambiguous, ”explains André Zylberberg.

Compared to Germany, France has an employment rate deficit of around 10 points in 2014. As for Greece, its employment rate is significantly lower than that of other countries. “This explains a large part of its problems,” continues the economist.

The youth employment rate (first graph below) in France is lower (28.1%) than that of the European Union (EU) (32.5%). In Greece, it is 13.3% compared to 46% in Germany. On the “senior” side (third graph below), the employment rate in France is also low: 47%. Finally, Germany arrives at 65.5% and the EU at 51.8%. Greece is still lagging behind with 34% of employment for 55-64 year olds. In the 25-54 age group (second graph below), France is practically on a par (80.5%) with Germany (83.5%). On the other hand, Greece is only at 62.4%.