1. Chapter 13 Section 1

2. -In 1990’s, unemployment in the United States hit the record low.
-Unemployment is not just a personal issue, it’s an issue for the economy as well.
-Economist can measure how healthy the economy is at any given time by counting the number of people who are unemployed.

3. -Economist look at four basic kinds of unemployment: frictional, seasonal, structural, and cyclical.
-The various kinds of unemployment have different effects on the economy as well as on the people who are unemployed.
-Frictional Unemployment-Occurs when people leave their current job and take time to find a new job.
-Seasonal Unemployment- Occurs when industries slow or shut down for a season or make seasonal shifts.

4. -Seasonal unemployment can be tough although it’s a normal part of a healthy economy.
-Migrant agricultural workers travel throughout the country to pick fruits and vegetables as various crops come into season.
-They know their work will likely end when winter comes.
-Migrant workers can also have periods of unemployment even during harvest season depending on weather patterns that year.

5. -Heat, cold, rain, and drought can all ruin harvest schedules by causing fruits and vegetables to ripen sooner or later than expected.
-Instead of moving smoothly from crop to crop, migrant workers might lose work time waiting for a crop to be ready for picking.
-Seasonal unemployment affects migrant farm workers, who can be without work once the harvest season is over.

6. -As the country developed an industrial economy, farm workers moved to urban areas to work in factories.
-Today, service industries are rapidly replacing manufacturing industries, and information services are expanding at break neck speed. -All these shifts lead to upheavals in the labor market. When the structure of the economy changes, the skills that workers must have in order to succeed in the economy also change.

7. -Structural Unemployment- Occurs when workers’ skills do not match the jobs that are available.
-There are 5 major causes of structural unemployment:
The development of new technology. New inventions and ideas often push out older ways of doing things.

8. -The discovery of new resources
-The discovery of new resources. New resources replace old resources and the industries that provide them.
-Changes in consumer demand. Consumers often stop buying one product and favor another one. Many people today favor sneakers over more traditional shoes. -Globalization. Recent trends in the world economy include a shift from local to global markets.

9. -Lack of education. People who drop out of school or fail to acquire the minimum skills needed for today’s job market may find themselves unemployed , employed part-time, or stuck in a low- wage job.
-Policymakers in the 1990’s recognized that computer technology, globalization, and other structural changes threatened the future of many workers.

10. As a result, they developed job-training programs to help workers gain new skills, especially computer skills.
Retraining takes all long time, however, and the new skills do not assure the trainees a high-wage job.
-Some companies began offering their own training programs.
-In this way, they can tailor the training to fit their exact labor needs.

11. Cyclical Unemployment - Unemployment that rises during economic down turns and falls when the economy improves .
During rescissions or down turns in the business cycle , the demand for goods and services drops , which means people will be laid off .
Most people are rehired when the rescission ends and the business resumes and upward trend .

12. Census – an official count of population .
Unemployment Rate – percentage of the nation’s labor force that is unemployed .
The amount of unemployment in the nation is an important clue to the health of the economy.
The government keeps a very careful track of how many people are unemployed and why .

13. Each month , the Bureau of Labor Statistics (BSL) , a branch of the U
Each month , the Bureau of Labor Statistics (BSL) , a branch of the U.S. Department of Labor, polls a sample of the population .
The sample taken , consisting of about 50,000 families , is designed to represent the entire population of the United States .
At the end of each month , interviewers poll families about employment that month .

14. From the poll , called the Current Population Survey, the BSL identifies how many people are employed and how many are employed .
Using these numbers the BSL computes the Unemployment rate .
The labor force is composed of civilians age 16 and older who have a job or are actively looking for one .

15. To determine the employment rate, BSL officials add up the number of employed people & the number of unemployed people , That figures equals the total labor force. Then they divide the number of unemployed people by the total labor force and multiply by 100 .

16. In an economy that is working properly, an unemployment rate around 4 to 6 percent is normal
Full employment- is the level of reached when no cyclical unemployment exists
Full employment means that nearly everyone who wants a job has a job

17. People who are working at low- skilled or low- wage jobs may be highly skilled or educated in a field with few opportunities
underemployed- working at a job for which they are over- qualified, or working part time when they desire full time work.
-Underemployment also describes the situation of people who want a permanent, full time jobs but have not been able to find one.
Discouraged workers- a person who wants a job but has given up looking

18. At very low unemployment levels, companies can find it difficult to recruit worker.
Competition among companies for employees can lead to wage increase.
at very low unemployment levels, companies can find it difficult to recruit worker.

19. Government policymakers consider an expanding economy.
When the economy grows rapidly for a long period.
When it rapidly grows for a long time it can cause unemployment to fall to levels that the economic problems may result.

20. Wage increases, which raise cost for employers, can lead to price increases
The say a car can over heat if the engine is over worked, and so can the economy
When economy is a very low unemployment levels, companies find it really hard and difficult to recruit workers, and competition among companies for employees can lead to a wage increase.

21. Questions

22. Describe frictional, seasonal, structural, and cyclical unemployment .
Question 1 .
Describe frictional, seasonal, structural, and cyclical unemployment .

23. Question 2 .
Explain why full employment does not meant that every worker is employed .

24. How do you find the Unemployment rate ?
Question 3 .
How do you find the Unemployment rate ?

25. How do Frictional & Structural Unemployment differ ?
Question 4 .
How do Frictional & Structural Unemployment differ ?

26. When does Cyclical Unemployment take place ?
Question 5 .
When does Cyclical Unemployment take place ?

27. Why isn’t full employment the same as zero unemployment ?
Question 6 .
Why isn’t full employment the same as zero unemployment ?

28. Question 7 .
What is the difference between Structural Unemployment & Cyclical Unemployment ?

29. What happens when people are unemployed ?
Question 8 .
What happens when people are unemployed ?

30. What is a discouraged worker ?
Question 9 .
What is a discouraged worker ?

31. How many people in the United States are unemployed ?
Question 10 .
How many people in the United States are unemployed ?