• Unemployment o Definitions: The Labor Force is the number of people who have jobs or who are actively looking for jobs The Employment Rate is the number of people who have jobs divided by the Labor Force The Unemployment Rate is one minus the Employment Rate; alternatively, it’s the number of people who don’t have jobs and are looking for jobs divided by the Labor Force o Important Points You can’t be unemployed if you’re not looking for a job! If we didn’t have this requirement, we’d be forced to list children, senior citizens, students, the heavily disabled, etc. as unemployed. Clearly this would be ridiculous. Unemployment also misses several major issues (underemployment, overqualification, discouragement, etc). • Keep this in mind when people fixate on the unemployment rate as a huge issue! • To repeat: if you’re not looking for a job, you’re not unemployed! So you can be out of work at great personal cost
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This note was uploaded on 11/28/2011 for the course ECON 102 taught by Professor Rossana during the Winter '08 term at University of Michigan.