Discouraged Worker

What is a discouraged worker?

When an unemployed person wants to have a job, but has given up looking for one, economists describe him or her as a discouraged worker.

Are discouraged workers accounted for in the unemployment rate? It depends which rate you’re referencing -- U.S. Bureau of Labor Statistics (BLS) actually has six different unemployment rates.

The first few rates, called U1, U2, and U3, are the most stringent. They do not include discouraged workers. U3 is the official unemployment rate, so when you hear about unemployment in the news, they’re typically referring to U3. But U3 only counts people who are unemployed and have looked for work within the past four weeks.

U4 through U6 do include some discouraged workers. These measures include unemployed people who want a job and have looked in the past year.

In the video, we’ll take a closer look at how these unemployment rates move with one another.

Want to learn more about unemployment? Check out our Macroeconomics section on Unemployment and Labor Force Participation.