Unemployment:
-
It is the failure to use available resources, particularly labor, to
produce desired goods & services
Underemployment:
-
Working less than 12 hours
Part-time:
-
Working 12-15 hours
People in the Labor Force:
-
Above 16 years of age
-
Able & willing to work
Not Included in Labor Force:
v Military
v Students
v Retired
v Disabled
v Homemakers
v Mental Institutions
v Jail/Prison
v Those
Who Aren’t Looking for a Job
Unemployment Rate: 4 to 5%= Full Employment or Natural Rate
of Unemployment (NRU)
How to Calculate Unemployment Rate:
# of unemployed/(# of employed +
# of unemployed)×100
Types of Unemployment
|
Frictional
|
Structural
|
Seasonal
|
Cyclical
|
|
-Those who are searching for a job
-Temporary unemployed or in between jobs
-Have transferable skills
- Ex. College//high school graduates, laid off from your job or you
leave or job
|
- Changes in the structure of
the labor force that make some skills obsolete
- DO NOT have transferable skills
- Has to learn new skills to get
a job
|
-Due to the time of year and nature of the job
- Ex. School bus drivers, lifeguards, Santa Claus/Easter Bunny
impersonators, construction workers
|
- As demand for goods and services falls, demand for labor falls &
workers are laid off
|
v
Frictional + Structural Unemployment= NRU
v
full Employment means there is NO cyclical
unemployment
GDP Gap: The amount by which actual falls short of potential
GDP
Okun’s Law: For every 1% in which the actual unemployment
rate exceeds the NRU a GDP gap of about 2% occurs
Rule of 70: It is
used to determine how many years it takes for a value to double given a
particular annual growth rate.
70/interest rate= # of years
Do you believe that people who are capable of work but do not want to work should actually be included??? Because I believe they should, and is it possible in your opinion that a nation could ever get to 4% or below unemployment rates?
ReplyDeleteAlso, I find it difficult to understand because there are plenty disabled who works, but then again I do understand why mental institutions won't count. Also, college should somewhat be nevessary because I believe that can help reduce the amount of structural unemployment, people should be well rounded so they could have a rebound job in case their speciality is no longer of use
ReplyDeletei agree with tolani because when more people are educated they inquire certain skills that will enable them to be well rounded therefor decreasing the unemployment rate. If only people could go for education vs a job at McDonalds
ReplyDelete