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SHRINKING WORK FORCE

The unemployment rate declined in August, but for a bad reason: The government doesn’t count people as unemployed if they’ve stopped looking for a job.

The number of people working or looking for work shrank in August by 368,000, the government said. The reasons vary, economists say.

Many people, after months of looking for a job without success, give up. But this group of “discouraged” workers doesn’t fully capture the phenomenon.

New parents, for example, may quit a job to focus on raising children.

An older worker who’s laid off may claim Social Security benefits instead of looking for a new job.

And there’s also a demographic shift underlying the trend: Baby boomers are retiring.

The result is that the percentage of working-age Americans with a job or looking for one has dropped to 63.5 percent, a 31-year low.

— Christopher S. Rugaber, AP Economics Writer

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WHO’S UNEMPLOYED?

When the government surveys 60,000 U.S. households each month to determine the unemployment rate, it doesn’t actually ask anyone if they’re unemployed.

Instead, Census workers ask a series of questions, in phone or in person. Some are detailed. For example:

Do you own a business?

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