Chapter 9 Part 1 Unemployment

Unemployment rate formula

Calculation of the percentage of unemployed individuals in the labor force

Labor force participation rate

Percentage of the working-age population actively engaged in the labor force

Discouraged workers

Individuals available for work but not actively seeking employment

Unemployed

Individuals available for work actively seeking employment but without a job

Frictional unemployment

Short-term unemployment from matching workers with jobs, enhancing economic efficiency

Structural unemployment

Unemployment due to a mismatch between worker skills and job requirements, affecting economic efficiency

Cyclical unemployment

Unemployment resulting from business cycle recessions, reducing economic efficiency

Natural rate of unemployment

Normal rate comprising frictional and structural unemployment, around 5% in the U.S.

Factors affecting natural rate of unemployment

Influence of unemployment insurance, minimum wage laws, and labor unions

Establishment Survey

Data collection from businesses on employees, job vacancies, and hiring trends

Household Survey

Data collection from individuals on employment status, demographics, and education levels