What a Labour Market Statistic Counts
Work produces goods or services. employment is work exchanged for pay. An occupation is the recognised bundle of tasks in a job. Unpaid domestic and care work is not counted in official statistics.
The International Labour Organization uses three exhaustive categories:
- employed: did any paid work in the reference week.
- unemployed: without work, available to start, and actively searching.
- inactive: neither employed nor unemployed.
The unemployment rate is the unemployed divided by the active population (employed plus unemployed). Discouraged workers who stop searching become inactive. This reduces the rate without anyone finding work.
Common pitfall: Reading the unemployment rate as the share of all adults without a job. Always check the employment rate alongside it.
Labour Market Structure
| Primary segment | Secondary segment | |
|---|---|---|
| Contract | Stable, open-ended | Temporary, intermittent |
| Pay | Rises with tenure | Flat |
| Training | Employer-financed | Minimal |
| Mobility | Internal career ladders | Movement between employers |
| Downturn | Hours reduced | Contract not renewed |
Doeringer and Piore developed this dual labour market model. It often describes Spain, where temporary contracts fell after the 2021 reform.
Spanish unemployment reached 26.9 per cent in 2013. In Spain, union density is low, yet collective bargaining coverage covers around 80 per cent through extended sectoral agreements.
Work organisation developed through distinct stages:
- Frederick Taylor formulated Scientific Management, separating planning from execution.
- Ford introduced the moving assembly line in 1913.
- Harry Braverman argued in 1974 that capitalism continuously deskills work.