1. Test & Notebook: 10/31 Warm Up: What is CPI and what does it measure?
Unemployment #38
Test & Notebook: 10/31
Warm Up: What is CPI and what does it measure?

2. Unemployment
Unemployment – when people have no jobs and they are willing and seeking for work.
Unemployment Rates = Unemployed Workers  / Total Labor Force

3. Causes of Unemployment
Inflation
Disability
Recessions
Rapid changes in technology
Attitude towards employers
Perception of employees
Employee values
Discriminating Factors like ethnicity, race, age etc. in work place

4. Year
Annual
1948
3.8
1949
5.9
1950
5.3
1951
3.3
1952
3.0
1953
2.9
1954
5.5
1955
4.4
1956
4.1
1957
4.3
1958
6.8
1959
1960
1961
6.7
1962
1963
5.7
1964
5.2
1965
4.5
1966
1967
1968
3.6
1968
3.6
1969
3.5
1970
4.9
1971
5.9
1972
5.6
1973
1974
1975
8.5
1976
7.7
1977
7.1
1978
6.1
1979
5.8
1980
1981
7.6
1982
9.7
1983
9.6
1984
7.5
1985
7.2
1986
7.0
1987
6.2
1988
5.5
1989
5.3
1969
3.5
1970
4.9
1971
5.9
1972
5.6
1973
1974
1975
8.5
1976
7.7
1977
7.1
1978
6.1
1979
5.8
1980
1981
7.6
1982
9.7
1983
9.6
1984
7.5
1985
7.2
1986
7.0
1987
6.2
1988
5.5
1989
5.3
1990
5.6
1991
6.8
1992
7.5
1993
6.9
1994
6.1
1995
1996
5.4
1997
4.9
1998
4.5
1999
4.2
2000
4.0
2001
4.7
2002
5.8
2003
6.0
2004
5.5
2005
5.1
2006
4.6
2007
2008
2009
9.3
2010
9.6
2011
8.9

5. Types of Unemployment:
Normal, Transitional Unemployment
exists at all times: when people move from job to job for better wages or wait for better opportunities.
Casual and Seasonal Unemployment
affected by weather conditions and casual unemployment, such as agri­culture, dockyard, hotels, restaurants and construction business

6. Frictional Unemployment
jobs may exists but people do not take up jobs away from the home
Structural Unemployment
change in the demand for the products of a given industry
Cyclical Unemployment
both external and internal factors outlook: largely mastered by Govern­ment activity to control the development of cycles

7. Effects
Wages
inflation
underemployment
Labor force

8. Alternative measures of labor underutilization
U-1 Persons unemployed 15 weeks or longer, as a percent of the civilian labor force.
U-2 Job losers and persons who completed temporary jobs, as a percent of the civilian labor force.
U-3 Total unemployed, as a percent of the civilian labor force. (The announced unemployment rate.)
U-4 Total unemployed plus discouraged workers, as a percent of the civilian labor force plus discouraged workers.
U-5 Total unemployed, plus discouraged workers, plus all other persons marginally attached to the labor force, as a percent of the civilian labor force plus all persons marginally attached to the labor force.
U-6 Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force.

9. Coding Unemployment
Determine if each individual is employed, unemployed, or not employed but no longer in the labor force.
Color the boxes with scenarios of employed workers green.
Color the boxes that represent people not in the labor force gray.

10. Color the boxes as follows:
Categorize unemployed workers into one of the four types of unemployment.
Color the boxes as follows:
frictional unemployment – brown
structural unemployment – blue
seasonal unemployment – yellow
cyclical unemployment – red

11. Let's plug in some numbers!