Term
| Bureau of Labor Statistics (BLS) is divides the population into 3 groups: |
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Definition
-Employed
-unemployed
-not in the labor force |
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| paid employees, self-employed, & unpaid workers in family business |
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| people not working who have looked for work during the previous 4 weeks |
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| the total # of workers, including the employed and unemployed |
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| percent(%) of the labor force that is unemployed |
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| Unemployment rate (“u-rate”): |
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| 100x (# of unemployed)/(labor force) |
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| Labor force participation rate: |
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| % of the adult population that is in the labor force |
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| labor force participation rate= |
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| 100x (labor force)/(adult populat) |
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| Why is u-rate a perfect indicator of joblessness? |
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•It excludes discourages workers
•Does not distinguish between full time and part time jobs
•Some people may misreport their status in the BLS survey |
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Term
| Natural rate of unemployment: |
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| the normal rate of unemployment around which the actual unemployment rate fluctuates |
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| the deviation of unemployment from its natural rate |
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-occurs when workers spend time searching for the jobs that best suit their skills and tastes
-short-term for most workers |
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-occurs when there are fewer jobs than workers
-usually longer-term |
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| the process of matching working with appropriate jobs |
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| __________________: a govt program that partially protects workers’ incomes when they become unemployed; UI increases frictional unemployment. |
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| Unemployment insurance (UI) |
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| _________________: Firms voluntarily pay above-equilibrium wages to boost worker productivity. |
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