ch7notes - The Labor Market Employment and Unemployment...

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The Labor Market Employment and Unemployment Measures Bureau of Labor Statistics (BLS) Monthly Survey of 60,000 households Categories Employed Unemployed Not in the Work Force
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Definitions mployed Number Une loyed Number Emp e Labor Forc + = Employment Rate % 100 lation Adult Popu loyed Number Emp × = nt Rate Unemployme % 100 e Labor Forc mployed Number Une × = Labor Force Participation Rate % 100 lation Adult Popu e Labor Forc × =
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Kinds of Unemployment Natural Rate of Unemployment: the underlying trend in the unemployment rate about which the unemployment rate fluctuates. Cyclical Unemployment: the deviation of the unemployment rate from the natural rate of unemployment. Frictional Unemployment: Unemployment that results because it takes time for workers to search for the jobs that best suit them. (Job Search) Structural Unemployment: Unemployment that results from the labor market institutions which match up workers and firms. Examples include hiring and firing costs, unemployment benefits, and the level of the minimum wage. Actual U = Natural U + Cyclical U Natural U = Frictional U + Structural U
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Employment Rate has been increasing More women are working Slightly fewer men are working Employment falls in recessions Unemployment trended up in 1970’s Unemployment has since trended down Most Unemployment spells are short Most unemployment is long-term Wage and Earnings Facts Average wages have trended upward Wage growth has been uneven
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This note was uploaded on 07/17/2008 for the course ECON 502.02 taught by Professor Mccafferty during the Spring '08 term at Ohio State.

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ch7notes - The Labor Market Employment and Unemployment...

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