Definition
- Unemployment
- Unemployment is being without a job while able and looking for work, so that the earnings from a job stop.
Unemployment in brief
Unemployment is when people who are able to work and are actively looking for a job cannot find one. The unemployment rate is the number of unemployed people divided by the labour force, which is those in work plus those looking for it. People who are not looking, such as full-time students, are not counted.
The figure
In the United Kingdom, 4.7% of the labour force was out of work in 2025, the 106th highest rate of the 185 countries with data.
Source: World Bank, unemployment (SL.UEM.TOTL.ZS).
Common questions
- How is the unemployment rate calculated?
- Unemployed people divided by the labour force, multiplied by 100. The labour force is the employed plus the unemployed.
- What are the main types of unemployment?
- Frictional (between jobs), structural (skills or location do not match jobs), cyclical (weak demand) and seasonal.
- Can the rate fall without more people working?
- Yes. If people give up looking for work they leave the labour force, and the rate falls even though no more people have jobs.
Example
Can you think of an example of unemployment?
A factory closes and its machine operator lives on benefits worth less than his wage was.
Test yourself
Can you name five causes of poverty in the UK?