The Key Difference Between Unemployment and Underemployment Rate

unemployment vs underemployment rate
Feature	Unemployment Rate	Underemployment Rate
Definition	Percentage of the labor force that is actively seeking work but currently without a job.	Percentage of employed individuals working less than they would like or in jobs below their skill level.
Measurement	Calculated by dividing the number of unemployed by the total labor force.	Measured by counting workers working part-time involuntarily or in mismatched roles.
Focus	Focuses on those without any job but actively looking for one.	Focuses on workers who are employed but underutilized.
Economic Implication	Indicates the availability of jobs and economic health.	Indicates inefficiencies in the labor market and skills mismatch.
Examples	Recent graduates searching for jobs, laid-off workers.	Part-time workers wanting full-time jobs, graduates working in unrelated fields.
Policy Response	Policies focus on job creation and unemployment benefits.	Policies focus on skills training and improving job quality.