Unemployment

Labor force

The total number of workers, including both the employed and the unemployed.

Unemployment rate

The percentage of the labor force that is unemployed.

Labor-force participation rate

The percentage of the adult population that is in the labor force.

Discouraged workers

Individuals who would like to work but have given up looking for a job.

Frictional unemployment

Unemployment that results because it takes time for workers to search for the jobs that are a best fit for them.

Structural unemployment

Unemployment that results because of a mismatch between the skills needed for the job opening and the skills of the unemployed worker.

Cyclical unemployment

Unemployment that results from recession; there are simply not enough jobs available for everyone who wants them.

Natural rate of unemployment

The normal rate of unemployment that typically exists in the economy, made up of Frictional + Structural unemployment.

Union

A worker association that bargains with employers over wages and working conditions.

Efficiency wages

Above-equilibrium wages paid by firms in order to increase worker productivity.