Economics AS · The Macroeconomy. The idea in plain words, the rules to remember, the mistake to avoid and a worked example, written and checked by Mega Lecture.
The unemployed are people of working age who are without a job, are able and willing to work, and are actively looking for work. The labour force is the employed plus the unemployed. People who are not looking for work, such as full-time students and the retired, are outside the labour force.
Unemployment is measured by the claimant count (people receiving unemployment benefit) or by a labour force survey (a sample of households). Both have weaknesses.
You must be able to name the type of unemployment from its cause: frictional, structural, cyclical, seasonal or technological. Unemployment means lost output, lower incomes, lower tax revenue and higher government spending on benefits.
Students divide the number unemployed by the total population. Divide by the labour force. Also, people who stop looking for work are no longer counted as unemployed, so the rate can fall without any new jobs.
Answer: The unemployment rate is 8%.
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