Unemployment

Now we look at the factors of unemployment and unemployment rate. Unemployment is the failure to use available resources, particularly labor to produce desired goods and services.

Labor is defined as those above 16 years of age, and those that are also able and willing to work.

Those not in the labor force are those in military, mental institutions, jail or prisons, retired, students, and people not looking for a job.

Unemployment Rate: 4-5% full employment
Natural rate of unemployment = NRU

How to calculate
(# of unemployed / (# of employed + # of unemployed)) x 100 = unemployment rate

Types of unemployment

Frictional- searching for a job, temporarily unemployed, and have transferable skills.
Structural- changes in the structure of the labor force, makes some skills obselete, and have no transferable skills.
Seasonal- due to time and nature of job
Siclicle- results from economic downturns, recession, laid off.