Chapter 21

Chapter 21 - Chapter 21 Why unemployment is a serious...

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Unformatted text preview: Chapter 21 Why unemployment is a serious problem: • Lost production and incomes • Lost human capital * Biggest source of unemployment: job losers Labour force survey: • Conducted by Stats Canada • Every month • Asks 54000 households Working age population – the total number of people age 15 years and over Labour force – the sum of the employed and the unemployed • Employed: FT or PT workers • Unemployed: must be available for work and must be in one of the following categories: o Without work but has made significant efforts to find a job within the previous four weeks o Laid off from a job and waiting to be called back to work o Waiting to start a new job within four weeks FOUR LABOUR MARKET INDICATORS • The Unemployment Rate o An indicator of the extent to which people who want jobs can’t find them o The percentage of people in the labour force who are unemployed o UR = (# of people who are unemployed / labour force) x 100 • The Involuntary Part-Time Rate o The percentage of people in the labour force who work part-time but want full-time jobs o IPTR = ( # of involuntary part-time workers / labour force ) x 100 • The Labour Force Participation Rate o An indicator of the willingness of people of working age to take jobs o The percentage of the working-age population who are members of the labour force o LFPR = ( labour force / working age population ) x 100 • Employment-to-Population Ratio o An indicator of both the availability of jobs and the degree of match between people’s skills and jobs o The percentage of people of working age who have jobs o ETPR = ( # of people employed / working age population ) x 100 • * The unemployment rate fluctuates over the business cycle: it increases as a recession depends, reaches a peak after the recession ends, and decreases after a recovery gets going • * The employment-to-population ratio fluctuates with the business cycle: it falls in a recession and rises in an expansion. The labour force participation rate has milder business cycle swings that reflect movements into and out of the labour...
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This note was uploaded on 03/22/2010 for the course ECON 1022 taught by Professor Hammond during the Winter '10 term at UWO.

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Chapter 21 - Chapter 21 Why unemployment is a serious...

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