How does a recession affect cyclical unemployment?
Recessions increase cyclical unemployment due to decreased demand and layoffs.
How does increased automation affect structural unemployment?
Automation can increase structural unemployment by making some skills obsolete.
How does a new college graduate affect frictional unemployment?
New grads increase frictional unemployment as they search for their first job.
If the labor force participation rate decreases, what does that indicate?
Fewer people are actively engaged in the job market.
How does a skills mismatch affect unemployment?
Skills mismatch leads to structural unemployment, as workers lack needed skills.
How does a rise in minimum wage affect unemployment?
It can lead to structural unemployment if the new wage is above the market equilibrium.
How does increased job training affect unemployment?
It can reduce structural unemployment by equipping workers with new skills.
How does a booming economy affect cyclical unemployment?
It decreases cyclical unemployment as businesses hire more workers.
How does the gig economy affect frictional unemployment?
It increases frictional unemployment as people frequently switch between short-term jobs.
How does increased globalization affect structural unemployment?
It can increase structural unemployment as jobs move overseas.
What are the differences between frictional and structural unemployment?
Frictional is temporary, due to job transitions; structural is long-term, due to skills mismatch.
How do cyclical and structural unemployment differ?
Cyclical is due to economic downturns; structural is due to skills mismatch.
What is the difference between the labor force and the total population?
Labor force includes employed and actively seeking; total population includes everyone.
Compare and contrast employed vs. unemployed.
Employed have jobs; unemployed are actively seeking jobs.
How do household and employer surveys differ in measuring unemployment?
Household surveys ask individuals; employer surveys ask companies about payrolls.
What is the difference between unemployment rate and labor force participation rate?
Unemployment rate measures unemployed as % of labor force; participation rate measures labor force as % of population.
What is the difference between cyclical and frictional unemployment?
Cyclical is due to recessions, while frictional is due to normal job transitions.
What is the difference between structural and voluntary unemployment?
Structural is due to skills mismatch, while voluntary is due to choice.
What is the difference between unemployment and underemployment?
Unemployment is being without a job while actively seeking work; underemployment is working part-time but wanting full-time.
What is the difference between the labor force and the working-age population?
The labor force includes those employed or actively seeking work; the working-age population is all individuals of legal working age.
What is the labor force?
Employed + actively seeking employment. (16+ years old)
Define labor force participation rate.
(Labor Force / Total Population) x 100
What is the unemployment rate?
(Number of Unemployed / Labor Force) x 100
Define frictional unemployment.
Temporary unemployment as people move between jobs or enter the workforce.
What is structural unemployment?
Unemployment due to a mismatch between worker skills and available jobs.
Define cyclical unemployment.
Unemployment caused by economic downturns or recessions.
Who are discouraged workers?
People who want to work but have given up looking; not in labor force.
What is the labor force?
The total number of workers, including the employed and unemployed.
What is the unemployment rate?
The percentage of the labor force that is unemployed.
Define natural rate of unemployment.
The sum of frictional and structural unemployment.
