1. Wages The Scenario: -The auto manufacturer is facing increased competition from overseas automobile companies and needs to cut costs in order to stay competitive. -The company C.E.O. has just announced that she is considering cutting wages as a cost-saving measure.

2. Questions- Each Group needs to answer 1. How would wage cuts affect members of your group? 2. What alternatives to wage cuts can you think of for cutting costs? How would these alternatives affect members of your group? 3. Do you think that wage cuts are the best solution to the problem? If so, why? If not, what do you think would be the best solution? 4. What do members of the other four groups have to gain from listening to your point of view (is it important for members of other groups to have you on their side)?

3. Standard SSEMA1b- Define unemployment SSEMA1c- Calculate the Unemployment rate SSEMA1d- Identify the types of unemployment

4. Measuring Unemployment People available for work who made specific effort to find a job during the last month and who, during the most recent week worked less than one hour for pay or profit

5. The Unemployment Rate The number of unemployed individuals divided by the total number of persons in the civilian labor force # unemployed/ civilian labor force = unemployment rate

6. The Unemployment Rate

7. Kinds of Unemployment 1. Frictional 2. Structural 3. Cyclical 4. Seasonal l

8. Frictional Unemployment Unemployment caused by workers who are between jobs for one reason or another

9. Structural Unemployment Unemployment that occurs when a fundamental change in operation of the economy reduces the demand for workers and their skills

10. Structural Unemployment

11. Cyclical Unemployment Unemployment directly related to swings in the business cycle

12. Seasonal Unemployment Unemployment resulting from changes in the weather or changes in demand for certain products

13. Effects of Unemployment Fewer workers means lower productivity which leads to lower GDP Aggregate Demand and Supply are lower because of lower wages, goods and services

14. Color Circle White- Frictional Yellow – Structural Green- Cyclical Red- Seasonal Orange- Technological Define your type of unemployment and then give an example of it.

15. Ice Cream Cone When you are through, raise your hand. I will give you a brown cone. On here, write the equation for the unemployment rate. As a group answer… Why is unemployment bad for the economy? How might it signal a recession?