Unemployment in india and general Unemployment.ppt

Economics unemployment

2. The labor forceincludes all persons over age
eighteen who are either working for pay or
actively seeking paid employment.
People who are not employed or are not
actively seeking work are not considered part
of the labor force.

3. The labor-force participation rateis the
percentage of the population working or
seeking employment.

4. Unemploymentis the inability of labor-force
participants to find jobs.
If a person is not employed and is actively
seeking work they are counted as
unemployed. People not engaging in or
actively seeking work are not part of the labor
force.

5. The unemployment rateis the proportion of
the labor force that is unemployed.Unemployment rate=
number of unemployed people
labor force

6. How long a person remains unemployed is
affected by the nature of the joblessness.
◦Job leavers
◦Job losers
◦Reentrants
◦New entrants

7. A discouraged workeris an individual who is
not actively seeking employment but would
look for or accept a job if one were available.
Discourage workers are not counted as part
of the unemployment problem after they give
up looking for a job.

8. Underemploymentexists when people
seeking full-time paid employment work only
part time or are employed at jobs below their
capability.
Underemployed workers represent labor
resources that are not being fully utilized.

9. There are four major types of unemployment
◦Seasonal Unemployment
◦Frictional Unemployment
◦Structural Unemployment
◦Cyclical Unemployment

10. Seasonal unemploymentis the unemployment
due to seasonal changes in employment or
labor supply.
Season unemployment can affect farm
workers, Christmastime retail workers, and
other jobs without year-round production.

11. Frictional unemploymentis the brief periods
of unemployment experienced by people
moving between jobs or into the labor
market.

12. Frictional unemployment differs from other
unemployment in three ways:
There is an adequate demand for the labor of
the frictionally unemployed.
The frictionally unemployed have the skills
required for existing jobs.
The job-search period will be relatively short.

13. Structural unemploymentis the
unemployment caused by a mismatch
between the skills (or location) of job seekers
and the requirements (or location) of
available jobs.

14. Structural unemployment is the worst for the
economy, as workers must learn new skills
and develop more training before they can
get new employment.
Periods of structural unemployment tend to
be longer than the other varieties.

15. Cyclical unemploymentis the
unemployment attributable to the lack of
job vacancies –i.e., to an inadequate level of
aggregate demand.
Usually, the economy will return to a normal
level on its own, but in extreme examples
(e.g. The great depression), government
help is needed to alleviate cyclical
unemployment.

16. Fullemployment is not the same as zero
unemployment.

17. The natural rate of unemploymentis the
long-term rate of unemployment determined
by structural forces in labor and product
markets.