Ch 15 Unemployment

Most spells of unemployment are

Short but most unemployment observed at any given time are long term

Evidence indicates that the typical person who becomes unemployed will

Soon find a job

Cyclical unemployment

The deviation of unemployment from its natural rate

The Labor-force participation rate is computed as

(The labor force/ Adult population) *100 The labor force participation rate of women has increased due to smaller families. And the labor force participation rate of men has decreased due to retiring younger and living longer.

The unemployment rate equals to

(The number of people unemployed /the labor force)*100

Labor force participation rate

-Measures total adult population in the labor force -those who have chosen to participate in the labor market

Bereau of Labor Statistics

-measures unemployment -produces data from the regular survey of 60,000 households -produces data on unemployment monthly -categories of adults surveyed: employed and unemployed, NOT underemployed -adult category-> at least 16 years old -those who are waiting for a job or are temporarily layoff, those who are available for work,those who have looked for work in the past 4 weeks, or are UNemployed -those who,certain unpaid,on vacation and part-time workers, those who are absent from their job, self-employed or work EVEN without pay for a family business are still considered as Employed -a college student, who is not working and not looking for a job is neither employed, nor in the labor force Unempl. Rate = Unempl./Empl.+ Unemp.

The BLS defines the unemployment rate as the

-percentage of the labor force that is unemployed

The US natural rate of unemployment in 2009 was

5 percent

A typical American worker covered by unemployment insurance receives

50% of his former wage for 26 weeks

Teenagers have more frequent unemployment spells so on average they spend more time searching for jobs. This means that teenagers have

A higher unemployment rate. Of a larger portion of the adult population were tenaged, the natural rate of uneployment would be higher

The reported unemployment rate should be viewed as

A useful but imperfect measure of joblessness

The natural unemployment rate includes

Both frictional and structural unemployment

Policies that help to find a job

Can reduce both frictional unemployment and the natural rate of unemployment

Individuals that would like to have a job, but they have given up after the unsuccessful search. These individuals are called

Discouraged workers

Providing training for unemployed individuals is primarily intended to reduce

Frictional unemployment

From time to time the demand for wroners has risen in one part of the US and has fallen in the other part of the US. This illustrates

Frictional unemployment created by sectoral shifts

People who are unemployed because of job search are classified as

Frictionally unemployed

Over the past several decades, the difference between the labor force participation rate of men and women in the US

Has gradually decreased

Sectoral shifts in demand for output

Increase unemployment due to a job search

Cyclical unemployment is caused by

Neither frictional nor structural unemployment

After World War II the labor force participation rate

Of men was 87 and 2009 it was 72. Of women was 33 and in 2009 it was 60

The BLS counts discouraged workers as

Out of the labor force. If they were classified as unemployed the reported unemployment rate would be larger

The BLS surveys help to determine

The number of jobs gained or lost

The Labor force equals to

The number of people employed plus the number of people unemployed

Suppose that some people report themselves as unemployed, when in fact they are working in the underground economy. If these people were counted as employed then

The unemployment rate would be lower and the labor-participation rate would stay unaffected

Frictional unemployment

The unemployment that results because it takes time for workers to search for the jobs that would best suit their tastes and skills. It often explains short spells of unemployment

If natural rate of unemployment is 5.2 percent and the actual rate of unemployment is is 5.7 percent

Then there is a cyclical unemployment amounting to 0.5 percent of the labor force

The cyclical rate of unemployment is sometimes below the natural rate of unemployment

True

Structural unemployment

When the number of jobs available in some labor markets may be insufficient to give a job to everyone who wants. It often explains long spells of unemployment

Marginally attached workers are people

Who are not working and are not looking for work. But would work if asked

Who is eligible for the unemployment insurance benefits

Workers that were laid off from work, because the employers didn't need their skills anymore