Labor Force
Plain definition
The labor force is the total number of people who are either employed or unemployed but actively seeking work. It excludes those not seeking work: retirees, full-time students, stay-at-home parents, and discouraged workers who have stopped looking.
In economics
The labor force is the denominator of the unemployment rate and the base for the labor-force participation rate (labor force / working-age population). Shrinking participation — from aging, discouragement, or disability — can make unemployment look better while the economy actually weakens, which is why economists watch both numbers together. Demographics make participation a slow-moving but crucial driver of long-run growth.
Example
A country with 160 million employed and 8 million unemployed-and-looking has a labor force of 168 million, even though its working-age population might be 260 million. The other 92 million — retirees, students, caregivers, discouraged workers — are out of the labor force entirely.
The labor force is often confused with the total population or the working-age population. Being of working age does not make someone part of the labor force — only working or actively seeking work counts. Students and retirees are working-age but typically out of the labor force, and 'discouraged workers' who quit searching drop out of both the labor force and the unemployment rate.