Measuring Unemployment and Structural Unemployment

Abstract

This paper surveys recent research on how to measure labour market activities such as unemployment and labour force participation. The conventional approach to distinguishing between unemployment and non-participation is to use a priori reasoning and self-reported survey responses about current activities, specifically availability for work and job search. In contrast, the research surveyed here employs evidence on the subsequent consequences of current activities, in particular on transitions among labour force states. This general approach appears to be a promising method for bringing evidence to bear on these difficult measurement issues.