Unemployment stas may understate and overstate true unemploymet through failures such as what and what?

Question

this is an economics question

Answer 1

1. Claimant Count Method.

This is the govt official method of calculating unemployment. It

counts the number of people receiving benefits (Job Seekers allowance)

Problems with Claimant count

i) The Count excludes those over 60, under 18, those on govt training

schemes, and married women looking to return to work

ii) Some people may claim benefits whilst still working in the “black market”

2. The Labour Force Survey

This is a survey asking 60,000 people whether they are unemployed

and whether they are looking for a job.

· It includes some people not eligible for benefits

Answer 2

well, as far as understating --  people have dropped off the employment/labor market because they could not find work so they give up.

as far as overstating (this case applies to me). my job was outsourced in July three years ago.  i did get a part time job by September.  But, it was a job that paid about 30K less per year.  In a few months later, I got a full time job but it paid 15K less than my outsourced job. Now, I get paid less than I did 10 years ago.  So, the statistics show that I'm employed but I'm employed at a level substantially less than my previous job.