Unemployment Three Types of Unemployment Frictional temporary transitional

Unemployment

Three Types of Unemployment Frictional – “temporary”, “transitional” “short-term. ” (“between jobs” or “search” Examples: 1. People who get “fired” or “quit” to look for a better job. 2. “Graduates” from high school or college who are looking for a job. 3. “Seasonal” or weather-dependent jobs such as: “agricultural”, “construction”, “retail”, or Frictional unemployment signals that “new jobs” “tourism. ” [lifeguards, resort workers, & are available and reflects “freedom of choice”. migrant These are workers. ] qualified workers “transferable” skills.

Three Types of Unemployment Structural – “technological” or “long term. ” basic changes in the structure of the labor force which make certain skills obsolete. √ Automation may result in job losses. Consumer taste may make a good “obsolete”. • The auto reduced the need for carriage makers. • Farm machinery reduced the need for farm laborers. √ “Creative destruction” means as jobs are created, “These other jobs aredo lost. of back. ” the future jobs not. Jobs come destroy jobs “Non-transferable of today. skills” – choice is prolonged unemployment or Frictional and retraining. Structural make up the “natural rate of unemployment”.

Three Types of Unemployment Cyclical – “economic downturns” in the business cycle. √ Cyclical fluctuations” caused by deficient demand for goods and services √ “Durable goods” jobs are impacted the most. • Purchase of these is durables can be “Cyclical unemployment” “real unemployment” postponed “These jobs do come back. ” because they can be repaired.

Full Employment Full employment is less than 100% because the economy is dynamic— frictional and structural unemployment are often inevitable. When labor markets are in balance, there is lag time. Workers seeking jobs & those retraining are the cause of the lag.

Hottest Jobs 5 Jobs for the Money 1. Physician/surgeon ($156, 000/$200, 000) 2. Airline pilot 5 Jobs for Independence 1. Computer engineer 2. System analyst ($95, 794) 3. Psychologist 3. Computer engineer 4. Clinical social worker ($70, 000) 5. Marketing, advertising, 4. Management consultant public relations manager ($60, 000) “Econ, Econ” 5. Lawyer($58, 000) 6. Teaching - oh!!

JOB FACTOID! In 1960, 60% of jobs could be held by unskilled or semi-skilled workers. Today, it is only 15%.

Hottest Jobs These jobs will have the most net gains through 2012 (in 1000’s) 1. Teachers K-12 2. Registered Nurses 724, 000 623, 000 3. Post secondary teachers 603, 000 4. Customer service reps 458, 000 5. Computer support 420, 000 6. General Operations Manager 376, 000 7. Sales reps 356, 000 8. Truck drivers 337, 000 9. Software engineers 307, 000 Bureau of Labor Statistics

Top Paying College Majors for 2004 1. 2. 3. 4. 5. 6. 7. 8. Computer Engineering $52, 169 Chemical Engineering $52, 038 Electrical/Electronics Engineer $50, 566 Computer Science $50, 543 Mechanical Engineering $49, 400 Mgmt Info Sys/Bus. Data Processing $42, 543 Economics/Finance $42, 150 Civil Engineering $41, 067 9. Accounting $42, 360 10. Management Info Sys $40, 000 11. Teaching $40, 600 12. Nursing $37, 803 13. Marketing/Marketing Mgmt. $36, 674 14. Business Admin/Mgmt $36 15. Communications $28, 000 16. Psychology $27, 000

Fastest Growing Fields These jobs will add the largest percentage of positions through 2012 1. Network Systems and Communication Analysts 57% 2. Physician Assistants 48. 9% 3. Software Engineers 45. 5% 4. Physical Therapist Assistants 44. 6% 5. Fitness Trainers 44. 5% 6. Database Administrators 44. 2% 7. Dental Hygienists 43. 1%

The FEDS Pay Well Many US Government jobs pay a higher average salary than what the private sector pays. (in thousands of dollars) 1 2 3 4 5 6 7 8 9 10 Astronomer Financial Managers Economist Chemist Electrical Engineer Public Affairs Librarian Land Surveyor Nurse Secretary FED Gov’t pays Private Sector pays $104 94 84 80 76 70 67 63 61 37 $86 84 63 57 74 51 54 59 52 31

GLOBAL PERSPECTIVE Unemployment Rates 5 Industrial Nations 1992 - 2002 15 France U. K. 10 Germany U. S. 5 0 1992 1997 2002 Source: Economic Report of the President, 2003 Japan