ch21 - Monitoring Cycles Jobs and the Price Level The...

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Chapter 21 Monitoring Cycles, Jobs, and the Price Level The Business Cycle The business cycle is a periodic but irregular up-and-down movement in production and jobs. A business cycle has two phases—expansion and recession–and two turning points—peak and trough. Expansion is the normal state of the economy. Canada has had only 4 recessions since World War II. A growth rate cycle downturn is a pronounced, pervasive, and persistent decline in the growth rate of aggregate economic activity. Jobs and Wages Every month, Statistics Canada surveys 54,000 households to track the state of the nation’s labour market. This survey is called the Labour Force Survey. The working-age population is the total number of people aged 15 years and over. The working-age population divides into two groups: those in the labour force and those not in the labour force. The labour force divides into two groups: the employed and the unemployed. A person is employed if they have either a full-time job or a part-time job. A person is unemployed if they are in one of the following categories: o Without work but has made specific efforts to find a job within the previous four weeks o Waiting to be called back to a job from which he or she has been laid off o Waiting to start a new job within four weeks Statistics Canada calculates four labour market indicators: o The unemployment rate o The involuntary part-time rate o The labour force participation rate o The employment-to-population ratio The unemployment rate is the percentage of the people in the labour force who are unemployed. Unemployment rate = (Number of people unemployed ÷ Labour force) × 100.
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The involuntary part-time rate is the percentage of people in the labour force who have part-time jobs and want full-time jobs.
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ch21 - Monitoring Cycles Jobs and the Price Level The...

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