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Chp 14:unemployment
Term | Definition |
---|---|
unemployed | sixteen years of age or older are considered unemployed if they actively searched for work in the last four weeks but are currently not employed. |
employed | are those who have worked at least one hour in the previous two weeks |
labor force | the number of employed plus unemployed people age sixteen and over |
unemployment rate | is equal to the number of unemployed persons divided by the number of people in the labor force |
labor force participation rate | the labor force divided by the working age population |
marginally attached workers | these people ready and available to work who have conducted a job search within the past 12 months but have not searched in the last 4 weeks and are therefore not included in official unemployment statics |
discouraged workers | people who have given up the job search and are officially classified as unemployed |
structural unemployment | caused by permanent destruction of jobs in a dying industry, a mismatch between the skills necessary for employment and the seekers' skill set, and government programs that create incentives to remain unemployed |
frictional unemployment | voluntary unemployment that occurs when a person enters the labor force and looks for a job. A recent graduate looking for her first job out of college would be an example of frictional unemployment |
creative destruction | ongoing process of technological innovation and industrial decline. |
U3 | the official unemployment rate |
U1 | the unemployment rate that only includes people unemployed fifteen weeks or longer |
U5 | the unemployment rate that includes all marginally attached workers |
U2 | the unemployment rate that only includes people who have lost a job as opposed to those who have quit or those who have entered or re-entered the labor force |
U6 | the most all-inclusive measure of unemployment as published by the BLS. Includes all those listed in U1-U5 plus those who are employed part time because of economic reasons |
U4 | the unemployment rate that adds discouraged workers to the official unemployment rate |
efficiency wages | a wage that exceeds the market wage. Encourages worker productivity but also plays a role in creating unemployment |
cyclical unemployment | unemployment associated with downturns in the business cycle. most economist view this as harmful and believe that government intervention is necessary to prevent it from occuring |
full employment | the level of employment that exist when the economy is being productively efficient |
natural rate of unemployment | the rate of unemployment that exist when there is no cyclical unemployment present in the economy. The natural rate of unemployment is thought to be independent of the inflation rate |