Chapter 22 Flashcards
The Current Population Survey
a monthly survey conducted by the Bureau of Labor Statistics and the Bureau of Census.
The Current Population Survey divides the population into what three categories to understand the labor force.
Working Age Population; Labor Force; Employed and Unemployed
Working Age Population
The total number of people aged 16 years and over who are not in jail, hospital, or some other for of institutional care or in the U.S. Armed Forces.
Labor Force
The number of people employed plus the number unemployed.
Employed and Unemployed
To be considered employed you must have worked at least one hour paid or fifteen hours unpaid for a family business.
To be considered unemployed, you must have
no employment, availability to work, and either tried to find employment or were waiting to be recalled to a job from which you have been laid off.
Two main labor market indicators
The Unemployment Rate; The Labor Force Participation Rate
The Unemployment Rate
The percentage of people in the labor force who are unemployed.
The Labor Force Participation Rate
The percentage of the working-age population who are members of the labor force.
How to calculate unemployment rate
(Number of people employed)/(Labor Force)X100
How to calculate labor force participation rate
(Labor Force)/(Working-age population)X100
U-1
Persons unemployed 15 weeks or longer, as a percent of the civilian labor force.
U-2
Job losers and persons who completed temporary jobs, as a percent of the civilian labor force.
U-3
Total unemployed, as a percent of the civilian labor force (official unemployment rate).
U-4
Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers.
U-5
Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, as a percent of the civilian labor force plus all persons marginally attached to the labor force.
U-6
Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force.
What are three types of unemployment we identify
Frictional Unemployment; Structural Unemployment; Cyclical Unemployment
Frictional Unemployment
the unemployment that arises from people entering and leaving the labor force.
Structural Unemployment
the unemployment that arises when changes in technology or international competition change the skills needed to preform jobs or change the locations of jobs.
Cyclical Unemployment
refers to the fluctuating unemployment over the business cycle that increases during a recession and decreases during an expansion.
The Natural Unemployment Rate
reflects when the economy is at full employment.
Full Employment
reflects to when there is no cyclical unemployment. I.e. the only unemployment is structural and frictional.
