In U.S. Bureau of Labor Statistics (BLS) usage, the labor force is the civilian, noninstitutional population age 16 and older who are either employed or unemployed under Current Population Survey rules. Put simply, it includes people working and people actively looking for work—not everyone who could potentially work.
What is the labor force?
The U.S. labor force is the sum of employed people and unemployed people as classified by the BLS’s monthly Current Population Survey (CPS). The CPS is conducted by the U.S. Census Bureau for the BLS and is a source of national employment and unemployment statistics. The BLS definitions and CPS Handbook of Methods describe the survey’s scope and rules.
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The population base is civilian and noninstitutional, age 16 and older. It excludes active-duty members of the U.S. Armed Forces and people confined to institutions such as prisons or residential care facilities. These are U.S. statistical definitions; other countries may use different population universes or survey rules.
Who counts as employed?
Under CPS rules, a person is employed if, during the survey’s reference week, they worked at least one hour for pay, worked at least one hour in their own business or farm, were temporarily absent from a job or business, or performed at least 15 hours of unpaid work in a family member’s business or farm. Volunteer work and unpaid internships do not count as employment under these definitions.
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Who counts as unemployed?
Generally, a person is unemployed if they had no employment during the reference week, were available to work, and made a specific, active effort to find a job during the four weeks ending with that week. The BLS FAQ gives examples of active search, including contacting employers, submitting applications, or interviewing. Merely reading a job posting and waiting for a response does not qualify as active search. People on temporary layoff who expect to be recalled are a special case: they can be counted as unemployed without a separate active search.
Who is not in the labor force?
Someone who is neither employed nor classified as unemployed is outside the labor force. That does not necessarily mean the person is unwilling to work. Some people outside the labor force say they want a job, but if they have not actively searched recently and do not qualify under another CPS rule, they are not included in the official unemployment count.
This distinction matters when interpreting labor-market figures: wanting a job and meeting the statistical definition of unemployed are not the same thing. The category “not in the labor force” describes a survey classification, not a judgment about a person’s motivation or ability.
How do labor force, participation, and unemployment measures differ?
These measures describe different parts of the labor market and use different numerators or denominators. The population base for the rates below is the civilian noninstitutional population age 16 and older.
| Measure | What it captures | Formula |
|---|---|---|
| Labor force | People classified as employed or unemployed | Employed + unemployed |
| Labor-force participation rate | Share of the civilian noninstitutional population working or actively seeking work | Labor force ÷ civilian noninstitutional population × 100 |
| Unemployment rate | Share of the labor force classified as unemployed | Unemployed ÷ labor force × 100 |
| Employment-population ratio | Share of the civilian noninstitutional population that is employed | Employed ÷ civilian noninstitutional population × 100 |
The unemployment rate can decline if job seekers stop searching and leave the labor force, even if employment has not increased. That follows from the rate’s numerator and denominator: the number unemployed and the size of the labor force both affect the result. The participation rate and employment-population ratio add context, but no single measure fully describes labor-market conditions.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How does the labor force affect the economy?
The labor force represents an important part of the economy’s available labor input. When more people are available to work, employment can grow without requiring the same rise in labor-force participation; when labor-force growth slows, sustaining employment growth can become more difficult. How much the economy can produce also depends on productivity—the output produced per worker.
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In an April 2, 2026 FEDS Notes analysis, Federal Reserve authors Seth Murray and Ivan Vidangos explain the relationship: “Potential GDP grows over time through two mechanisms: either changes in potential employment or growth in the average productivity of each worker.” Potential employment reflects the potential labor force and the share of it expected to be employed. Thus, labor-force growth helps shape potential employment growth and, alongside productivity growth, potential GDP growth.
What the Federal Reserve estimated for 2026
The figures below are estimates or projections published by the Board of Governors of the Federal Reserve System in 2026, not final observed outcomes or timeless rules.
- Potential labor-force growth: The authors reported average growth of about 1.4% per year since 1960. They projected growth of less than 10,000 workers per month in 2026 under their assumptions.
- Potential GDP growth: The authors attributed about 1.4 percentage points of average annual potential GDP growth from 1960 to 2025 to potential employment growth, with the remainder attributed to productivity growth.
- Breakeven employment growth: The authors estimated a pace near zero in 2026 as consistent with a steady unemployment rate, if their labor-force growth assumptions held.
The note’s implication is that, if labor-force growth is near zero, productivity growth would account for more of potential GDP growth. The outlook depends on assumptions about population growth, immigration, aging, participation, and productivity; changes in those assumptions can alter the projections.
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How to read labor-force statistics in context
- Check the population universe and age range. The BLS definitions here apply to the U.S. civilian, noninstitutional population age 16 and older.
- Identify the measure’s numerator and denominator. Participation, unemployment, and the employment-population ratio answer different questions.
- Distinguish definitions from current estimates. BLS definition pages explain classification rules; for current rates or counts, use a dated BLS data release.
- Read economic projections with their date and assumptions. A forecast of labor-force or employment growth is not a report of what ultimately occurred.
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