Macro 9 - Unemployment Flashcards
What is unemployment
exists when people who are able and willing to work are without jobs
Who are not classed as unemployed?
people not in the labour force
Who are people who are economically inactive?
Individuals not in the labour force but of working age
What are the reasons for unemployment being a key macroeconomic objective?
- Government can secure more tax
- Crime rate may increase if unemployment is too high
- Brain drain / immigration out of country decreases
Why is full employment not the same as zero unemployment?
Some people will always be unemployed and not willing to work (welfare)
How do you calculate unemployment?
(unemployed people / Labour force) / 100
What are the 2 measures of unemployment?
The ILO Measure
The Claimant count
What is the ILO measure of unemployment?
People who are out of work and who want to work and have looked for a job in the last 4 weeks
Who would not be counted in the ILO measure of unemployment?
Long term unemployed people
What is the claimant count measure?
Number of people in labour force who are on unemployment benefits
