Macroeconomics - L8 Labour Market & Employment Flashcards
To be considered as employed by the ABS, what criteria must be met?
- Aged 15 years or over
- Working more than 1 hour per week
- Receiving measurable remuneration (e.g. wages)
To be considered as unemployed by the ABS, what criteria must be met?
- Aged 15 years or over
- Actively looking for full-time or part-time work at any time in the last four weeks
- Available to work in the last four weeks that they were seeking work
- Waiting to start a new job within the last four weeks or could have started if work was available
The labour force consists of…
The number of people aged 15 and over who are either employed or actively seeking work.
(The total number of individuals employed or unemployed).
The formula used to calculate the unemployment rate is…
Unemployed / Labour Force x 100
What does the Labour Force Under-utilisation Rate (LFUR) represent?
The LFUR represents the proportion of the labour force that is ‘underutilised’, or the proportion of individuals not working the number of hours they would like to. This includes the unemployed and the underemployed.
The formula used to calculate the LFUR is…
Unemployed + Underemployed / Labour force x 100
List two reasons why under-utilisation is a problem.
- There is less income in the hands of households, which means lower levels of PCE, which leads to lower levels of economic activity and growth.
- It means lower living standards for Australians - both material and non-material.
- It means less revenue for the government in the form of income tax, and greater outlays in the form of welfare payments.
What does the Labour Force Participation Rate (LFPR) represent?
The percentage of the working age population who are participating in the labour force. Participation means employed or unemployed but actively seeking work.
The formula used to calculate the LFPR is…
Labour force / Working age population x 100
