February 09, 2017

 Unemployment Notes:

 What is unemployment? 

•  It is the percent of people in labor force who want a job but are not working. 

 What is the labor force? 

•  It is the number of people in a country that are either classified as either employed or unemployed. 

 What is employed?

1.  It is anybody that works at least one hour a month. 
2.  Someone who is temporarily absent from work. 
3.  Part-time people  

 Who is not in the labor force? 

1.  Kids. 
2.  Full-time students 
3.  People in mental situations 
4.  Military personal 
5.  Stay home moms and dads 
6.  Retirees 
7.  People incarcerated 
8.  Discouraged workers  

 Unemployment rate calculations? 

• #  of employed / # of  Labor force x 100

 What is the standard unemployment rate?

• 4% - 5%

 What are four types of unemployment? 

1.  Frictional  unemployment. 
2.  Seasonal unemployment 
3.  Directional  unemployment 
4.  Cyclical unemployment

 What is NRU? 

• Fictional plus structural equals NRU (4% - 5% ) 

 What  does full employment exclude? 

• No cyclical  unemployment 

 What is Okun's law?

• It is one unemployment rises 1% above natural rate of GDP falls about 2%