Ch06 - CHAPTER 6 Monitoring Jobs and the Price Level After...

Info iconThis preview shows pages 1–13. Sign up to view the full content.

View Full Document Right Arrow Icon
Monitoring Jobs and the Price Level CHAPTER 6
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
After studying this chapter you will be able to Define the unemployment rate, the labor force participation rate, the employment-to-population ratio, and aggregate hours Describe the sources of unemployment, its duration, the groups most affected by it, and how it fluctuates over the business cycle Explain how we measure the price level and the inflation rate using the CPI
Background image of page 2
Vital Signs Each month, we chart the course of unemployment as a measure of the health of the U.S. economy. How do we measure unemployment and what other data do we use to monitor the labor market? Having a job that pays a decent wage does not determine the standard of living; the cost of living also matters. So we also need to know what the Consumer Price Index is and how it is measured and used.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Jobs and Wages Population Survey The U.S. Census Bureau conducts a monthly population survey to determine the status of the U.S. labor force. The population is divided into two groups: 1. The working-age population —the number of people aged 16 years and older who are not in jail, hospital, or some other institution 2. People too young to work (under 16 years of age) or in institutional care
Background image of page 4
Jobs and Wages The working-age population is divided into two groups: 1. People in the labor force 2. People not in the labor force The labor force is the sum of employed and unemployed workers.
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Jobs and Wages To be counted as unemployed, a person must be in one of the following three categories: 1. Without work but has made specific efforts to find a job within the previous four weeks 2. Waiting to be called back to a job from which he or she has been laid off 3. Waiting to start a new job within 30 days
Background image of page 6
Jobs and Wages Figure 6.1 shows the population labor force categories and the magnitudes for 2006.
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Jobs and Wages Three Labor Market Indicators The unemployment rate The labor force participation rate The employment-to-population ratio
Background image of page 8
Jobs and Wages The Unemployment Rate The unemployment rate is the percentage of the labor force that is unemployed. The unemployment rate is (Number of people unemployed ÷ labor force) × 100. The unemployment rate reaches its peaks during recessions.
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Jobs and Wages The Labor Force Participation Rate The labor force participation rate is the percentage of the working-age population who are members of the labor force. The labor force participation rate is (Labor force ÷ Working-age population) × 100. In 2006, the labor force was 152.6 million and the working-age population was 228.7 million. The labor force participation rate was 67.6 percent.
Background image of page 10
Jobs and Wages The labor force participation rate falls during recessions as discouraged workers —people available and willing to work but who have not made an effort to find work within the last four weeks—leave the labor force.
Background image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Jobs and Wages The Employment-to-Population Ratio The employment-to-populatio n ratio is the percentage of working-age people who have jobs. The employment-to-population ratio equals
Background image of page 12
Image of page 13
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 47

Ch06 - CHAPTER 6 Monitoring Jobs and the Price Level After...

This preview shows document pages 1 - 13. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online