Overview
Unemployment and labor force dynamics are crucial aspects of economics that reflect the health of an economy. Understanding the different types of unemployment—frictional, structural, and cyclical—helps in analyzing labor market trends and formulating effective policies. The labor force participatio...
Key Terms
Example: If 10 out of 100 people are unemployed, the unemployment rate is 10%.
Example: A recent graduate looking for their first job experiences frictional unemployment.
Example: Workers in coal mining may face structural unemployment as demand for coal decreases.
Example: During a recession, many companies lay off workers, leading to cyclical unemployment.
Example: If 60 out of 100 working-age individuals are employed or actively seeking work, the participation rate is 60%.
Example: GDP growth rate and unemployment rate are key economic indicators.