Who is employed? Civilian Labor Force: +16, working, or looking. An employed person is any person 16 years old or older 1.who works for pay, either for someone else or in his or her own business for 1 or more hours per week (Part time workers) 2.who works without pay for 15 or more hours per week in a family enterprise, or 3.who has a job but has been temporarily absent, with our without pay.

Who is unemployed? An unemployed person is a person 16 years old or older who: 1. is not working, 2.is available for work, and 3.has made specific efforts to find work during the previous 4 weeks. A person who is not looking for work, either because he or she does not want a job or has given up looking, is not in the labor force.

CALCULATING UNEMPLOYMENT The formula for calculating the unemployment rate (expressed as a percent) is as follows: Unemployment Rate = (Unemployed Workers / Total Labor Force) * 100 Full Employment = 4-5% Unemployment

CALCULATING UNEMPLOYMENT For example: A small country has a population of 15,000 people. Of the total population, 12,000 people are in the labor force and 11,500 people are employed. What is the unemployment rate? First, find the number of unemployed by subtracting the number of employed (11,500) from the labor force (12,000). So, 12, ,500=500. Therefore, 500 people are unemployed. Now, to find the unemployment rate, plug the numbers into the formula: Unemployment Rate = (500/12,000)*100 = 4.2 percent.

 December 2007 start of the recession: Unemployment 5.0 %  September %  January % (12.6% Marginally Attached )  Currently about 13 million unemployed  6 million have been unemployed for six months = post WWII record  Discouraged Workers = 6.4 million  Underemployed = 18.6%

Unemployment Demographics

Unemployment & LEVEL OF EDUCATION Dec, 2012 Sept, 2010 Less than H.S. 11.7% 15.0% H.S. no college 8.0%10.8% Some college 6.9% 8.6% College Grad 3.9% 4.8%

Types of Unemployment Seasonal: Seasonal unemployment happens when a workers job is only in existence for part of the year. Examples???

Types of Unemployment Frictional: Frictional unemployment happens when a worker leaves one job to find a better opportunity for their skills, or when people are just entering the job market as a result of graduation.

Types of Unemployment Structural: Structural unemployment happens when peoples skills no longer match the available jobs in an economy. (Job relocates or replaced by technology.) Structural unemployment is the most difficult of the three types to correct. (Education / Skills / Training)

Types of Unemployment Cyclical: Is countercyclical to the business cycle. Cyclical unemployment goes up when the business cycle moves through contraction or recession, and decreases when the economy moves into expansion. Economic Cycle!!!

Laws or Theories? Okun's Law: (Unemployment / GDP) 1% increase = 2% decrease Say’s Law: An economic rule that says that production is the source of demand. So when an individual produces a product or service, they get paid for that work, and is then able to use that pay to demand other goods and services.