Unemployment

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Unemployment

  1. 1. Unemployment?<br />
  2. 2.
  3. 3. 25% of labor Was Unemployed <br />
  4. 4. 1933<br />John Keynes <br />“ General Theory of Employment Interest and Money “<br />What we Call Today “ Macroeconomics “<br />
  5. 5. But Why Unemployment is a Problem ? <br />
  6. 6. Lost of Production and Income <br />The loss of job brings a loss in income and loss in production too !<br />
  7. 7. Lost in Human Capital <br />Unemployment damages person job and destroy human Capital<br />
  8. 8. Current Population Survey <br />Working-age-Population: total Number of people aged 16 and over, not in jail, hospital, other institutional care <br />Labor force:  is the sum of the employed and the unemployed <br />
  9. 9. Labor Market Indicators <br />The Unemployment Rate <br />The Employment-to-Population Ratio<br />The Labor Force Participation Rate <br />
  10. 10. The Unemployment rate: <br /> is the percentage of the people in the labor force who are unemployed <br /> <br />  Number of people unemployed<br />     =   ــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــ    x 100<br />                                                    Labor force <br />
  11. 11. The Employment-to-Population Ratio: <br />is the percentage of people of working age who have jobs. <br /> <br />Employment-to-  <br />   Number of people Employed<br />=   ـــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــــ    x 100<br />     Working-age Population <br />
  12. 12. The Labor Force participation Rate:<br /> is the percentage of the working-age population who are member of the labor force. <br /> <br />                  Labor force<br /> =     ___________________   x 100 <br />                               Working-age Population     <br />
  13. 13. The Unemployment and Full-Employment <br /><ul><li>Unemployment Rate measures the underutilization but, it not imperfect measure for 2 reasons : </li></ul>It excluded some underutilized Labor <br />Some Unemployment is unavoidable “Natural” <br />
  14. 14. Why there is always someone Looking for Job? <br />Economy Churn ?<br />
  15. 15. The Price Level and Inflation Price Level <br />Price Level: the average level of prices, and the value of money <br /> <br />Inflation rate:the annual percentage change of the price level <br /> <br />
  16. 16. But Why inflation is a Problem ?<br />Redistributes income and wealth <br />Diverts resource from production <br />
  17. 17. The Consumer Price Index<br /> Is a measure of the average of the prices paid by urban consumers for a fixed &quot;basket&quot; of consumer goods and services.<br />
  18. 18. Constructing the CPI<br />Is a huge operation that costs millions of dollars and<br /> involves three stages:<br />Selecting the CPI basket<br />Conducting the monthly price survey<br />Conducting the CPI<br />
  19. 19. The Consumer Price Index<br /><ul><li>Figure 22.12(b) shows that the inflation rate is
  20. 20. High when the price level is rising rapidly and
  21. 21. Low when the price level is rising slowly.</li></li></ul><li>But ! <br />CPI is Not Perfect measure of Price Level !<br />CPI Probably Overstate Inflation Rate <br />
  22. 22. Thanks  <br />2 <br />تركي الرقيعي <br />عبدالله الحسن علي<br />محمد الخربوش <br />

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