According to the United Nations' agency International Labour Organization (ILO) the standard definition of unemployment is based on three criteria that have to be met simultaneously during the reference period.

• without work
• currently available for work
• seeking work

Statistical scope:

The source to the Faroese unemployment numbers are individuals registered as unemployed with the Faroese unemployment system and the social welfare services and who meet the above definition of unemployment. The report only includes people in ages 16 to 66, as these are the age limits in receiving the unemployment benefits. 

For international comparisons the annual figures from the labour force survey should be used. See Labour force, survey.

Definitions:

• Unemployed are individualswithout work, currently available for work and seeking work. 
• Affected by unemployment: The number of people who have been unemployed for one or more days in a month.
• Full-time unemployment: Since not everyone is unemployed every day of a given month, all individuals affected by unemployment are converted to full-time unemployed. For example, two persons who have been unemployed for half a month each are counted as one full-time unemployed person.
• Unemployment rate: The full-time unemployment rate in % relative to the relative labour force.
• Labour force counts the number of people in work or available to work. That includes people in employment and unemployment. 
• Seasonally adjusted figures are adjusted for seasonal variations such as recurring seasonal activity patterns
• Trend describes the unemployment trend by adjusting for seasonal effects and error components in the figures.
• EA refers to the euro area with a fixed area composition of the current 19 countries.
• EU (from June 2020) refers to EU27_2020, which is the European Union with a fixed area composition of the current 27 countries.