Thinking About the Labor Force Like an Economist
Unit 3 · Lesson 3.6 · Last updated June 2026
A 45-minute lesson where students sort identity cards to discover how the BLS categorizes the labor force and unemployed, then apply a flowchart to realistic scenarios and practice calculating the unemployment rate.
Overview
Students are introduced to how economists think about the labor force through a hands-on card sorting activity to discover the criteria for identifying the labor force and the unemployed. The lesson culminates with practical exercises applying their understanding to realistic scenarios. Note: This lesson assumes students have been introduced to key macroeconomic indicators in Lesson 3.2 and learned about GDP in Lessons 3.3, Lesson 3.4, and Lesson 3.5. Modify the activator and summarizer if this is students' first exposure to these concepts.
Learning Objectives
- Describe unemployment and how it is measured.
- Explain the interdependence of the GDP growth rate and unemployment rate.
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Materials
- Instruction Slides (display during class period)
- Identity Cards p. 5 (class set — 1 copy per pair, cut into 10 cards; consider printing on cardstock for longevity)
OR - Digital Identity Cards (make a copy for each student pair and enable editing access) + laptop or device (1 per pair)
- Student Handout pp. 6–7 (1 copy per student)
- Unit 3 Overview: Macroeconomics (previously distributed in Lesson 3.1)
Optional
- Color Copy Flowchart p. 8 (1 copy per student — use in place of the black-and-white version in Student Handout)
Lesson Sequence
Slides 2–5
- Display Slide 2 and allow approximately 30 seconds for students to discuss the first question with a peer. Debrief as a class. (Additional educator tips and suggested answers are in the notes section throughout Instruction Slides.) Click to reveal the follow-up question on Slide 2. Allow approximately 1 minute to discuss, then debrief as a class.
- Proceed to Slide 3. Use the doctor/economist analogy to remind students that economists use empirical data to assess the economy.
- Display Slide 4. Tell students they have already learned about GDP and will be introduced to another key indicator today — the unemployment rate. Remind students that economists use multiple indicators when assessing the economy and, as discussed in the activator, these indicators are interdependent.
- Display Slide 5 and introduce the learning objectives for the lesson.
Slides 6–39
- Advance to Slide 6. Acknowledge that people often misunderstand who is unemployed according to the official definition. Explain that the U.S. Bureau of Labor Statistics (BLS) has specific criteria for categorizing people as unemployed and determining who is counted in the unemployment rate.
- Tell students they will participate in a card sorting activity to organize people into categories, with the primary focus on learning who economists at the BLS include when reporting on the labor force and the unemployed.
- Place students into pairs and distribute 1 set of Identity Cards to each pair. If using the digital option, give each pair a link to their copy of Digital Identity Cards.
- Proceed to Slide 7. Tell students that 7 of the people described are part of the potential labor force and 3 are not. Allow 4 minutes to sort cards. Note: Students are not expected to know the answers yet — they should make their best guess. Term note: "Potential labor force" is a student-friendly term for what the BLS calls the "civilian noninstitutionalized population." Students should not take notes or move cards between rounds during this phase.
- Display Slide 8 to reveal the correct categorization. Instruct pairs to check their work and move incorrectly categorized cards.
- Proceed to Slide 9. Tell students to discuss the prompt for approximately 3 minutes.
- Display Slide 10. Reveal the actual criteria used to determine whether someone is part of the potential labor force. Walk students through the flowchart on the slide. Consider asking volunteers to share the criteria they created. Pro Tip: Students will receive a completed copy of the flowchart and definitions after the card sorting activity — they should not take notes yet.
- Proceed to Slide 11. Instruct students to discuss the questions with their partners. Consider calling on volunteers to share responses.
- Advance to Slide 12. Tell students that of the 7 people in the potential labor force, 5 are in the current labor force and 2 are not. Allow 2 minutes to sort (students should leave the 3 cards not in the potential labor force — Raj, Thiago, and Devon — off to the side).
- Progress through Slides 13–16 and repeat Steps 9–12 for this round.
- Display Slide 17. Tell students that of the 5 people in the labor force, 3 are employed and 2 are unemployed. Allow 1 minute to sort.
- Progress through Slides 18–21 and repeat Steps 9–12 for this round. Tell students to leave all Identity Cards in their correct categories after Slide 19.
- Proceed to Slide 22. Use the graphic to reinforce how the U.S. population is distributed into different categories. Emphasize that unemployed people are a small fraction of the labor force and an even smaller percentage of the total U.S. population.
- Display Slide 23. Tell students to discuss the question with a partner, then poll the class. Click to reveal the correct response. Alert students to the stumbling block (yellow warning graphic): people must be part of the labor force to be considered unemployed — the unemployment rate does not include all adults.
- Advance to Slide 24 and debrief as a class.
- Proceed to Slide 25. Distribute 1 copy of Student Handout to each student. Tell students they will now review key terms and apply their understanding.
- Display Slide 26. Direct students to follow the instructions. After approximately 4 minutes, click to solicit questions. Clarify as needed.
- Advance to Slide 27. Instruct students to work individually to answer the question. Encourage them to reference Identity Cards and the "Unemployment rate" definition on Student Handout. Alert students to the stumbling block again: the unemployment rate calculation does not include all adults — only those in the labor force. Pro Tip: Acknowledge this example is greatly simplified — real calculations include millions of people.
- After 2 minutes, poll the class. If there is consensus and students are correct, call on a volunteer to explain their answer and progress through Slides 28–29 to reinforce. Otherwise, proceed to Slide 28, have students check their work using the formula, poll again, then click to reveal the correct steps.
- Display Slide 30. Tell students to discuss the question with a partner, then debrief as a class (see notes section of Instruction Slides for suggested responses).
- Proceed to Slide 31. Emphasize that the actual BLS numbers are much larger than those used in the previous example. Alert students to the stumbling block once more. Instruct students to gather Identity Cards (or return them to the envelope) — they will not be used again.
- Display Slide 32. Read the instructions. Explain that students will refer to the flowchart on Student Handout to categorize different people.
- Proceed to Slide 33. Allow approximately 30 seconds to read and answer the practice scenario. Click to reveal the correct response and debrief.
- Advance through Slides 34–39, repeating Step 26 for each scenario. Consider skipping the last 2 to 3 scenarios if students consistently demonstrate mastery.
Slides 40–41
- Progress through Slides 40–41. Instruct students to locate their Unit 3 Overview and a half piece of paper, then write their responses to the prompts on Slide 41. If students have misplaced the overview, provide a new copy or have them reference a classmate's. Collect summarizers and review for misconceptions. Address at the start of the next lesson.
Aligned Standards
Voluntary National Content Standards in Economics
What Educators Are Saying
I love this lesson! Kept the students engaged because they were consistently being asked to think.
The manipulatives were great for differentiation. Students liked guessing who is in and out of the market. The flowchart was useful for an additional assignment I had them complete.
The flow chart was extremely helpful for students. I also like the terminology used. The opening exercise with the cards really helped the kids grasp the concepts right away.
