Types of Unemployment Frictional Unemployment Occurs when people

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Types of Unemployment

Types of Unemployment

Frictional Unemployment Occurs when people try to find a job. *Not always negative. Ex.

Frictional Unemployment Occurs when people try to find a job. *Not always negative. Ex. Job change Dissatisfied, Schooling, “Transitional”

Seasonal Unemployment Occurs when industries adjust to the natural seasonal production schedule. *Not always

Seasonal Unemployment Occurs when industries adjust to the natural seasonal production schedule. *Not always negative. Ex. Agricultural, summer, or holiday jobs.

Structural Unemployment Occurs when worker’s skills do not match the jobs that are available.

Structural Unemployment Occurs when worker’s skills do not match the jobs that are available. *negative Ex. New technology, changes in consumer demand, globalization, lack of education.

Cyclical Unemployment Mirrors the economic cycle. Ex. Low during peak, high during recession. ”laid-off”

Cyclical Unemployment Mirrors the economic cycle. Ex. Low during peak, high during recession. ”laid-off” ”down-size” ”cut-backs”

Additional Factors to Unemployment (Limitations) Underemployment Ex. Ph. D Flipping Burgers or Working part-time

Additional Factors to Unemployment (Limitations) Underemployment Ex. Ph. D Flipping Burgers or Working part-time when full time is desired. Discouraged Worker Ex. Could not find a job so they gave up. These do not show up in the unemployment rate. *Worst type!

5 Year Unemployment Rate

5 Year Unemployment Rate

Figuring Out the Unemployment Rate Employed: Everyone currently working 155. 2 Million including part-time

Figuring Out the Unemployment Rate Employed: Everyone currently working 155. 2 Million including part-time workers (16). Unemployed: People looking for work or 11. 7 Million temporarily laid off from work (16). Unemployment Rate: Unemployed 11. 7 Million Labor Force (Employed + Unemployed) 166. 9 Million Labor Force: Employed + Unemployed. 11. 7 (unemployed) divided by 166. 9 (labor force)=. 07 x 100 = 7% unemployment rate.

You Try �Employed = 145 million �The number of unemployed =9. 8 million Is

You Try �Employed = 145 million �The number of unemployed =9. 8 million Is this a high or low unemployment rate? 9. 8 =. 0633 or 6. 3% Unemployment Rate 154. 8

Calculating Labor Force Rate Labor force participation rate: % of adult population working. number

Calculating Labor Force Rate Labor force participation rate: % of adult population working. number in labor force x 100 = adult population Example - 50 million employed + 5 million unemployed x 100 = 59. 78% 92 million population

Unemployment Rates Vary by Ethnicity White 5. 3% Hispanics 7. 3% African American 11.

Unemployment Rates Vary by Ethnicity White 5. 3% Hispanics 7. 3% African American 11. 6% Asian 5. 7% Teenagers 19. 1%

Now You Try Classifying Unemployment

Now You Try Classifying Unemployment

Year Civilian Employed Unemployed Total Population Unemployment Rate Labor Force Participation Rate 1960 117

Year Civilian Employed Unemployed Total Population Unemployment Rate Labor Force Participation Rate 1960 117 66 4 70 5. 7% 60% 1980 168 99 8 107 7. 5% 64% 2000 209 135 6 141 4. 3% 67%

Negative Effects of Unemployment Smaller tax base. Less gov’t revenue. More government entitlements taken.

Negative Effects of Unemployment Smaller tax base. Less gov’t revenue. More government entitlements taken.

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