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Chapter 21

Chapter 21 (Monitoring Jobs and Inflation).pdf

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Department
Economics
Course
Economics 1022A/B
Professor
Jeannie Gillmore
Semester
Winter

Description
Chapter 21 Monitoring Jobs and Inflation Employment and Unemployment • Every month, Statistics Canada surveys 54,000 households to track the state of the nation’s labour market. • This survey is called the Labour Force Survey. • The working-age population is the total number of people aged 15 years and over. • The working-age population divides into two groups: those in the labour force and those not in the labour force. • The labour force is split into two groups: the employed and the unemployed. • A person is employed if they have either a full-time job or a part-time job. • A person is unemployed if they are in one of the following categories: o Without work but has made specific efforts to find a job within the previous four weeks. o Waiting to be called back to a job from which he or she has been laid off o Waiting to start a new job within four weeks • Statistics Canada calculates four labour market indicators: o The unemployment rate o The involuntary part-time rate o The labour force participation rate o The employment-to-population ratio • The unemployment rate is the percentage of the people in the labour force who are unemployed. • Unemployment rate = (Number of people unemployed ÷Labour force) x 100 • The involuntary part-time rate is the percentage of people in the labour force who have part- time jobs and want full-time jobs. • Involuntary part-time rate = (Number of involuntary part-time workers ÷ Labour force) x 100 • The labour force participation rateis the percentage of the working-age population who are members of the labour force. • Labour force participation rate = (Labour force ÷ Working-age population) x 100 • The employment-to-population ratio is the percentage of the working-age population who have jobs. • Employment-to-population ratio = (Number of people employed ÷ Working-age population) x 100 • The labour force participation rate and the employment-to-population rate show upward trends. • The unemployment rate increases in recessions and decreases in expansions. • The upward trends in the labour force participation rate and the employment-to-population ratio are accounted for mainly by the increasing participation of women in the labour market. Two types of labour are excluded from the official unemployment measure: o Marginally attached workers o Part-time workers who want full-time jobs • A marginally attached worker is a person who currently is neither working nor looking for a job but has indicated that he or she wants and is available for a job and has looked for work sometime in the recent past. • A discouraged worker is a marginally attached worker who has stopped looking for a job because of repeated failure to find one. Unemployment and Full Employment • Unemployment is classified into three types: o Frictional o Structural o Cyclical • Frictional unemployment is the unemployment that arises from normal labour market tur
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