Difference between activity rate and occupation or employment rate

comparisons

The main differences between the activity rate of a country and its occupancy or employment rate lie mainly in the numerator in the calculation formula for each of these.

In simpler terms, the activity rate takes into account to measure the employment situation of a country the active population, which is nothing more than the sum of the employed population and the unemployed population.

In contrast, the employment rate only includes the employed population, without taking into account the unemployed or unemployed population over the total working-age population, between the ages of 16 and 64.

Population

Occupation or employment rate

Activity rate

Example

Suppose we have the following data:

  • Working population: 17.000.000
  • Unemployed Population: 4.000.000
  • Inactive Population: 11,000,000

a) Calculate the activity rate.

b) Calculate the occupancy rate.

a) The calculation formula for the activity rate is as follows:

TA = (Active population (PA) / Working age population (PET)) * 100

From where;

PA = Employed Population (PO) + Unemployed Population (PD) = 17,000,000 + 4,000,000 = 21,000,000

To calculate the working-age population (WAP), we add the employed population (PO), the unemployed population (PD) and the inactive population (PI) and it gives us a result of 32,000,000.

In this way:

TA = (21,000,000 / 32,000,000) * 100 = 65.62%

b) The formula for calculating the occupancy rate is as follows:

TO = (Employed population (PO) / Working age population (PET)) * 100 = (17.000.000/32.000.000)*100=53,12%

Being:

PET = Employed population + Unemployed population + Inactive population

We have PET = 32,000,000

Later:

TO = (17,000,000 / 32,000,000) * 100 = 53.12%

As can be seen, the activity rate and the employment rate are different, although their name may lead to a conceptual misinterpretation.

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