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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



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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