The labor force includes which of the following?

• A. The labor force includes only employed people.
• B. The labor force includes only unemployed people.
• C. The labor force includes both employed and unemployed people who are actively seeking work.
• D. The labor force includes all people over 16.

Answer: (C)

The labor force is made up of people who are able and willing to work and are either employed or actively seeking work. That means it includes those who currently have jobs and those who don’t have a job but are actively looking for one and are available to work. People who are not looking for work—such as students, retirees, or those who have given up searching—are not counted in the labor force. So the labor force is the sum of employed plus unemployed people who are actively seeking work, not all people over 16. This is why the correct description is that the labor force includes both employed and unemployed people who are actively seeking work.