Feb 9 notes_Ch 3

Feb 9 notes_Ch 3 - Chapter 3 Employment Issues Feb 9 notes...

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Chapter 3 Employment Issues Feb 9 notes
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I want to make sure that everyone has the correct definition for the Labor Force Participation Rate: It is the fraction of the population who wants to participate in the labor market. (I wasn’t sure I said this exact definition in one of the classes, so I wanted to make sure you had it!)
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Explain how the unemployment rate is calculated, what it means, and weaknesses to the calculation. Calculation: # unemployed / # of people in the labor force (employed and unemployed actively looking for work) Definition: Doesn’t give the fraction of the adult population that is unemployed, only the fraction of the labor force that is unemployed. During business expansion unemployment decreases. During recession unemployment increases. Unemployment is unevenly distributed across demographic groups. It is greater among the very young, minorities, and workers with few skills. Unemployment for adult females is higher than for males. Teenagers: 2 or 3 times the national average. We’ll answer weaknesses on a later slide.
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Who is considered unemployed? To be considered a part of the unemployed actively looking for work a person must satisfy three criteria: 1. He or she is without a job 2. He or she would be able to take a job if it were offered. 3. He or she has looked for work in the preceding four weeks. Note: If a person doesn’t have a job and isn’t looking he/she is not considered unemployed.
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Calculating the Unemployment Rate Assume you are analyzing the labor market of a large-sized metropolitan area. The area has a total population of 4,230,000; 2,500,000 are civilian individuals who are not institutionalized and over the age of 16. Of those, 150,000 are not currently employed, but are looking for work and 900,000 are currently working for pay. 5,000 individuals were looking for work last year, but have since given up searching. Additionally, 10,000 individuals who are not currently working
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Feb 9 notes_Ch 3 - Chapter 3 Employment Issues Feb 9 notes...

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