ECON102 Chapter Notes - Chapter 21: Labour Force Survey, Gdp Deflator, Frictional Unemployment

• School: University of Waterloo
• Department: Economics
• Course: ECON102
• Professor: Maryann Vaughan

Document Summary

Why unemployment is a problem: lost incomes and production, lost human capital. The loss of income is devastating for those who bear it. Unemployment benefits create a safety net but don"t fully replace lost wages, and not everyone receives them either. Prolonged unemployment permanently damages a person"s job prospects by destroying human capital. Labour force sum of employed and unemployed workers: not included in labour force survey: The unemployment rate: percentage of the labour force that is unemployed, (number of people unemployed / labour force) x 100, unemployment rate increases in a recession and reaches its peak value after the recession ends. Labour force participation rate: percentage of the working-age population who are members of the labour force, (labour force / working-age population) x 100. Purpose of the unemployment rate is to measure the underutilization of labour forces. Stats can believes that the unemployment rate gives a.