ECON 0110 Lecture Notes - Lecture 4: Underemployment

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greenyak694

5 Jun 2018

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Chapter 8

Unemployment

Employed (E)

Any person 16 years or older who:

Works for pay, either for someone else or in his/her own business for

1 or more hours per week

□

Works without pay for 15 or more hours per week in a family

enterprise

□

Has a job but has been temporarily absent with or without pay

□

○

Unemployed (U)

A person 16 years old or older who is not working, is available for work,

and has made specific efforts to find work during the previous 4 weeks

○

Labor Force (LF)

Sum of employment and unemployment

E + U

○

•

Labor Force Participation Rate

The percentage of the population aged 16 or older that is in the labor force

○

(Labor force / Population age 16 and older)*100

○

•

Unemployment Rate

The percentage of the total number of people in the labor force who are

unemployed

○

(Number of unemployed workers / Labor force)*100

○

•

Example: Unemployment Rate

Population age 16 or older (working-age population) = 40,675

○

Unemployed = 2,175

○

Employed = 26.235

○

Labor force participation rate

○

•

Unemployment Rate

○

Unemployment Rate Issues

The unemployment rate can overstate the true level of unemployment.

It often takes at least a few weeks to find a job even if the worker knows

they will find a job.

These workers are still counted as unemployed.

The unemployment rate never reaches 0%.

○

The unemployment rate can understate the true level of unemployment

Does not count Discouraged Workers

Nonworking people who are capable of working but have give up

looking for a job given the state of the job market

□

Does not include Marginally Attached Workers

Would like to be employed and have looked for a job in the recent past

but are not currently looking for work

□

Does not include Underemployment

The number of people who work part time because they cannot find a

full-time job

□

○

•

Unemployment & Economic Growth

Unemployment is closely linked to economic growth.

○

Most years that see above average growth in real GDP see the unemployment

rate fall.

○

Most years that see below average growth in real GDP see the unemployment

rate rise.

○

Jobless Recovery

A period in which the real GDP growth rate is positive but the

unemployment rate is still rising

○

•

Lecture 4

Sunday,*May*27,*2018

3:37*PM

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Document Summary

Works for pay, either for someone else or in his/her own business for. Works without pay for 15 or more hours per week in a family enterprise. Has a job but has been temporarily absent with or without pay. A person 16 years old or older who is not working, is available for work, and has made specific efforts to find work during the previous 4 weeks. The percentage of the population aged 16 or older that is in the labor force (labor force / population age 16 and older)*100. The percentage of the total number of people in the labor force who are unemployed (number of unemployed workers / labor force)*100. Population age 16 or older (working-age population) = 40,675. The unemployment rate can overstate the true level of unemployment. It often takes at least a few weeks to find a job even if the worker knows they will find a job.

Related Questions

1) The working-age population includes

A) those in jails and hospitals.

B) youngsters between the ages of 14 and 16 if they are working at least part time.

C) employed and unemployed people over the age of 16.

D) only employed people over the age of 16.

E) people over the age of 16 who are in the Army.

2) The labor force includes people who

i.are less than 16 years of age.

ii.are in institutions.

iii.are actively seeking a job but do not have a job.

A) i only

B) i and iii

C) i and ii

D) iii only

E) i , ii, and iii

3) Assume the U.S. population is 275 million. If 210 million people are of working age, 135 million are employed, and 6 million are unemployed, what is the size of the labor force?

A) 275 million

B) 141 million

C) 135 million

D) 210 million

E) 204 million

4) The unemployment rate is the number of people unemployed divided by the

A) population, then multiplied by 100.

B) labor force participation rate, then multiplied by the population.

C) labor force, then multiplied by 100.

D) number of people employed, then multiplied by 100.

E) working-age population, then multiplied by 100.

5) Suppose the population is 220 million people, the labor force is 150 million people, the number of people employed is 130 million, and the working-age population is 175 million people. What is the unemployment rate?

A) 9.0 percent

B) 13.3 percent

C) 11.4 percent

D) 15.4 percent

E) 20 percent

6) Suppose the working-age population is 220 million, the labor force is 150 million, and the unemployment rate is 10 percent. The number of unemployed people is

A) 15 million.

B) 22 million.

C) 37 million.

D) 7 million.

E) 70 million.

7) The labor force participation rate is the

A) labor force divided by the working-age population, then multiplied by 100.

B) number of people employed divided by the labor force, then multiplied by 100.

C) labor force divided by the population, then multiplied by 100.

D) discouraged workers divided by the labor force, then multiplied by 100.

E) number of people employed divided by the population, then multiplied by 100.

8) If the number of employed people is 150 million, the number of unemployed people is 50 million, and the working-age population equals 285 million people, the labor force participation rate is

A) 70.2 percent.

B) 81 percent.

C) 17.5 percent.

D) 25 percent.

E) 52.6 percent.

9) A discouraged worker is

A) a person who is not happy with his or her job.

B) someone who works part time but wants full-time work.

C) someone who is asked to work overtime everyday.

D) someone who does not have a job but has given up looking.

E) another name for an unemployed worker.

coppermarten219

1) The working-age population includes

A) those in jails and hospitals.

B) youngsters between the ages of 14 and 16 if they are working at least part time.

C) employed and unemployed people over the age of 16.

D) only employed people over the age of 16.

E) people over the age of 16 who are in the Army.

2) The labor force includes people who

i. are less than 16 years of age.

ii. are in institutions.

iii. are actively seeking a job but do not have a job.

A) i only

B) i and iii

C) i and ii

D) iii only

E) i , ii, and iii

3) Assume the U.S. population is 275 million. If 210 million people are of working age, 135 million are employed, and 6 million are unemployed, what is the size of the labor force?

A) 275 million

B) 141 million

C) 135 million

D) 210 million

E) 204 million

4) The unemployment rate is the number of people unemployed divided by the

A) population, then multiplied by 100.

B) labor force participation rate, then multiplied by the population.

C) labor force, then multiplied by 100.

D) number of people employed, then multiplied by 100.

E) working-age population, then multiplied by 100.

A) 9.0 percent

B) 13.3 percent

C) 11.4 percent

D) 15.4 percent

E) 20 percent

6) Suppose the working-age population is 220 million, the labor force is 150 million, and the unemployment rate is 10 percent. The number of unemployed people is

A) 15 million.

B) 22 million.

C) 37 million.

D) 7 million.

E) 70 million.

7) The labor force participation rate is the

A) labor force divided by the working-age population, then multiplied by 100.

B) number of people employed divided by the labor force, then multiplied by 100.

C) labor force divided by the population, then multiplied by 100.

D) discouraged workers divided by the labor force, then multiplied by 100.

E) number of people employed divided by the population, then multiplied by 100.

8) If the number of employed people is 150 million, the number of unemployed people is 50 million, and the working-age population equals 285 million people, the labor force participation rate is

A) 70.2 percent.

B) 81 percent.

C) 17.5 percent.

D) 25 percent.

E) 52.6 percent.

9) A discouraged worker is

A) a person who is not happy with his or her job.

B) someone who works part time but wants full-time work.

C) someone who is asked to work overtime everyday.

D) someone who does not have a job but has given up looking.

E) another name for an unemployed worker.

silvergnu415

1. For April 2015, the Bureau of Labor Statistics (BLS) estimates that the number of employed workers in the US was 148,523,000. The total number of workers who were not employed but were actively seeking work or waiting to be recalled from the layoff was 8,549,000. The total number of workers who were not employed and were neither looking for work nor waiting to be recalled from the layoff was 93,194,000.

a. Calculate the number of workers in the labor force and the adult working population.

b. Calculate the labor force participation rate and the unemployment rate.

c. Figure 2.1 in the lecture slides gives the same data, but for April 2013. Calculate the percentage change in the number of unemployed workers, the percentage change in the number of workers in the labor force, and the percentage change in the adult working population between April 2013 and April 2015.

d. Has the labor market improved between April 2013 and April 2015? Has it clearly improved, or is there a chance that it has not actually improved? Justify your answer. (Hint: Compare the labor force participation rate and the unemployment rate for April 2013 and April 2015).

byzantiumbutterfly960

ECON 0110 Lecture Notes - Lecture 4: Underemployment

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