Unemployment Rate

In: Business and Management

Submitted By lyang49
Words 1470
Pages 6
Memorandum TO: PROFESSOR STAIGER FROM: LUYAO YANG SUBJECT: U.S UNEMPLOYMENT RATE DATE: APRIL 10, 2016 Unemployment is a familiar and sensitive concept for people in the labor force. In particular, during the recession, a lot of people will loss the job and unemployment can have a great influence to the social stability. This memo will start with the definition and measurement of unemployment. Then it will show the impact of unemployment to the nation and the relationship between unemployment and GDP. After that, it will continue to discuss the how the unemployment rate will affect the Federal Reserve decision regarding to rate. In the end, historical data from different categories will be displayed to further discuss unemployment.

Definition and Measurement

Unemployment occurs when people are actively seeking for jobs but cannot find a job. The unemployment rate is a quantitative measure of the prevalence of unemployment. It is calculated as a percentage by diving the number of unemployed individuals by all individuals currently in the labor force (see…...

Similar Documents

Understanding the Factors Affecting the Unemployment Rate Through Regression Analysis

...Understanding the Factors Affecting The Unemployment Rate Through Regression Analysis An Individual Report Presented to The Faculty of Economics Department In Partial Fulfillment To The Requirements for ECONMET C31 Submitted to: Dr. Cesar Rufino Submitted by: Aaron John Dee 10933557 April 8, 2011 1 TABLE OF CONTENTS I. INTRODUCTION 4 A. Background of the Study 4 B. Statement of the Problem 5 C. Objective 5 II. THEORETICAL FRAMEWORK AND RELATED LITERATURE 6 A. GDP 6 B. Average Years in School 6 C. Population 7 D. Literacy Rate 7 III. OPERATIONAL FRAMEWORK 9 A. Model Specification 9 B. List and Description of Variables 9 C. A-priori Expectations 10 IV. METHODOLOGY 12 V. EMPIRICAL RESULTS AND INTERPRETATIONS 13 A. Regression of the Original Model 13 2 B. Summary Statistics 15 C. Testing for Misspecification in the Model 16 D. Testing for Multicollinearity 17 E. Testing for Heteroscedasticity 18 VI. CONCLUSION 21 VII. BIBLIOGRAPHY 22 3 I. INTRODUCTION A. Background of the Study When we were still kids, we dream of what we want to be in the future. Older people will usually ask us if what we want to be in the future. Most of us will say, they want to be a doctor, lawyer or engineer to name some. We think and think about our career, but once we are already in the college level, we now dream to become......

Words: 4362 - Pages: 18

Us Unemployment Rate

...U.S. Unemployment Rate- January 2013 According to the Bureau of Labor Statistics (BLS), the U.S. unemployment rate was essentially unchanged for January at 7.9% (http://www.bls.gov/news.release/empsit.nr0.htm). Although nonfarm payroll increased by about 157,000 the unemployment rate wasn’t affected and has remained at or near the same rate since September 2012. The year over year (Jan. 2012 to Jan. 2013) unemployment rates dropped by about .4%, down from 8.3%, but the number of persons not in the labor force also grew by about 1.1 million over the same period. Industries that reported adding jobs were retail, construction, health care, and wholesale. Industries that shrank included transportation and warehousing. Looking at unemployment by major worker groups (adult men, adult women, teenagers, whites, blacks, Hispanics, and Asians) was unchanged. Also unchanged was the number of long-term unemployed at about 4.7 million, accounting for 38.1% of the overall unemployed. These are individuals who have been searching for work for 27 weeks or more. In January, the number of persons marginally attached to the workforce dropped by about 366,000 to 2.4 million. Of these 2.4 million, 804,000 were not counted in the unemployment rate due to being considered discouraged and 1.6 million were not counted in the unemployment rate because they had not searched for work in the prior four weeks for reasons such as school or family responsibilities. According to a......

Words: 577 - Pages: 3


...Reducing Unemployment and Underemployment in the United States Name Institutional Affiliation Reducing Unemployment and Underemployment in the United States Reducing Unemployment Unemployment and underemployment are one of the main economic concern in many countries or states in the world today. It is a biting problem in many economies and governments are always seeking a new way of solving this problem (Miller, 2011). According to the Bureau of Labor Statistics, unemployment is a situation where a person does not have a job, but have actively searched in the past four weeks (Clague, 2009). It also includes people who have been laid off for than seven days. There are many reasons why people end up being unemployed. Understanding the reasons for unemployment is essential in coming up with a solution to the high rate of unemployment in the United States. The most important causes of unemployment are structural, cyclical and seasonal unemployment (Borts, 2010). The United States has experienced approximately 11 recessions since 1948 when the postwar ended. The different government regimes have tried various methods over the years to turn around recessions and reduce the high rates of unemployment. Some government regimes have embarked on tax while others have embarked on stimulus spending. Unemployment rate in America remained high at 7.6 % in June 2013 (Clague, 2009). The Bureau of Labor Statists reports on all matters relating to unemployment in the United States. In......

Words: 1750 - Pages: 7

How Did the Reforms of the Last Decade Impact the Unemployment Rate in Germany? – a Strong Flexible Labor Market

...A strong flexible labor market How did the reforms of the last decade impact the unemployment rate in Germany? – A strong flexible labor market When Gerhard Schröder took to the podium in the Bundestag on March 14th, 2003, Germany was called the “sick man of Europe”. A widespread assumption was that unemployment could never be defeated, The Economist Introduction: The German labor market experienced remarkable transitions during the past decade. In the beginning of the millennium, Germany was a country with an unemployment rate (see appendix 1) ranging between 9.5% and 11.5% (Deutsche Bundesbank) with almost 39 million people employed all over the country (see appendix 2). Until the beginning of 2003, the governmental support to unemployed people consisted of three main patterns: unemployment insurance, unemployment assistance, and supplementary social welfare. Supporting these three pillars, Germany was suffering high costs with long-term unemployment benefits, low job acceptance rate and bigger proportion of low-skilled labor. Between 2003 and 2006, the German federal government implemented series of reforms aiming to impact the supply side of labor by increasing incentives for unemployed workers to accept jobs and reducing the level and duration of their benefits. With this research paper, we will analyze the impact of these reforms in the unemployment rate. The Agenda 2010: The agenda 2010 was a series of reforms organized and executed by the federal government SPD and...

Words: 1557 - Pages: 7


...Unemployment in Bosnia and Herzegovina has reached a not so enviable level of 57 % . At the beginning of the year 2013 the records of employment were registered at 553,501 unemployed . Every month, the number of unemployed persons increased by 0.89 %. The fact that I have to mention is that the unemployment rate (official unemployment rate) in Greece is 22 % , which is struggling with the recession . One of the devastating fact is that 262,996 unemployed people or 49.93 % of job seekers are women. Is sexism in question? A fear that we may have a woman who will take a job, be a leader ? Additionally, highest unemployment rate is among young people and it is at 67 %, which is as much as 9 % more than in the previous five years. I think that the particularly troubling fact is that every year it is recorded only a continuation of the negative trend when it comes to the position of young people who are getting worse, and the problems are only deeper. The high rate and the level of youth unemployment has lasting negative consequences for the economy. Young people are choosing to leave Bosnia and Herzegovina every year. Statistics show that 37% of young people will leave Bosnia and Herzegovina, while 10 % have already taken concrete steps to leave out country. On step to hunger is 60 % of the BiH population. With the current level of economic activity, I think that there will be no improvement in the situation until the year 2017. This is leading to additional pressure, especially...

Words: 311 - Pages: 2

Newspaper Coverage of the Increase in the Unemployment Rate in the Bahamas

...The Bahamas, like most countries, is encumbered by a variety of issues, for example crime, illegal immigration, education reform, economic growth and unemployment. These issues are reported by numerous medias one of them being newspapers. Newspapers are a reliable and popular source of receiving information. Frequently “newspaper vendors stand at the roadside during the morning rush hour, selling copies of the daily papers” and “commuters stop their cars amid traffic to buy copies” (Benjamin & LeGrand, 2012, p. 22). In The Bahamas there are two commonly read local daily newspapers, The Nassau Guardian and The Tribune (Benjamin & LeGrand, 2012). On October 23rd, 2013 the Department of Statistics released its 2013 Labour Force Survey, which was conducted in May 2013 and showed that the unemployment rate in the Bahamas had increased from 14% to 16.2% (Thompson, 2013). The following day, The Nassau Guardian and The Tribune reported on this topic. This paper seeks to analyze the manner in which these two newspapers covered this topic. Newspaper coverage of the increase in the unemployment rate in The Bahamas The Nassau Guardian and The Tribune Both The Nassau Guardian and The Tribune had the matter of the unemployment rate increasing as their front page news article. Clearly both newspapers felt this was an important topic because only significant and meaningful stories are placed on the front page of a newspaper, above the fold and toward the left of the page (Baran, 2006)....

Words: 1688 - Pages: 7

Asean Economic Intergration in 2015 and Unemployment Rate in the Philippines

...ASEAN ECONOMIC INTERGRATION IN 2015 AND UNEMPLOYMENT RATE IN THE PHILIPPINES Elah Czarina C. Andal, CPA IR 204 INTRODUCTION A little over a year ago, the author attended a forum entitled “The Road to ASEAN Economic Community: Maximizing Opportunities and Facing Challenges.” The introduction in the forum’s invite included the following: “The 10 ASEAN member nations are moving towards integration, with the goal of forming an ASEAN Economic Community (AEC) by 2015. Designed to boost regional resilience, the AEC will create a single market and production base characterized by the free flow of goods, services, investments, capital and skilled labor.”1 With much optimism, the author takes note of a promise of greater opportunities for Filipinos as a result of the 2015 ASEAN economic integration and eventual formation of AEC. Further with excitement, the question as to whether this integration comes with the promise of lower unemployment rate in the Philippines beginning 2015 was posted. BACKGROUND AND STATEMENT OF THE PROBLEM Several studies have been made and many articles have been written regarding the ASEAN economic integration as well as the AEC. This would include those which explain what will happen in 2015 when the integration takes place, those which challenge the readiness of the Philippines for the free trade economy or the preparation for it, or those which presents its impact to the country (both on the perspective of opportunities and challenges). This paper......

Words: 1800 - Pages: 8

Unemployment Rate of Malaysia

...3.0 Unemployment Unemployment is defined as a situation where someone of working age is not able to get a job but would like to be in full time employment (Pettinger. T, 2010). In a modern economy, unemployment has a variety of causes. Some of them relate to the general level of economic activity, others are the result of a failure of the labour market in an economy to work optimally. Among the main types of unemployment, we can consider real wage unemployment, demand deficient unemployment, frictional unemployment, structural unemployment and hidden unemployment (Tutor2u, 2014). Table 2: Unemployment Data of Malaysia (2003 - 2012) Year | Unemployment rate | 2003 | 3.61 | 2004 | 3.54 | 2005 | 3.53 | 2006 | 3.33 | 2007 | 3.20 | 2008 | 3.30 | 2009 | 3.70 | 2010 | 3.40 | 2011 | 3.10 | 2012 | 3.10 | (Source: World Bank, 2014) Figure 2: Unemployment Data of Malaysia (2003 – 2012) (Source: World Bank, 2014) Based on the data table 2 shown above, Malaysia consists of 10 years fluctuation unemployment over the business cycle which starts from the year 2003 until year 2012. In the year 2003, the unemployment rate is 3.61% and contraction up to 3.54% and 3.53% in the year 2004 and 2005 respectively. In the year 2006, the unemployment rate has decrease to 3.33% and continues to drop until 3.2% in the year 2007. In the year 2008, the unemployment rate has slightly raised back to 3.3%. Malaysia encountered a serious unemployment which......

Words: 711 - Pages: 3

The Resolution to the Rise of the Unemployment Rate in the United States

...The Resolution to Raising the Unemployment Rate in the United States Precious Johnson CM 104-04 Professor Johnson 8/24/2010 The Resolution to Raising the Unemployment Rate in the United States There are a lot of things in life that are not guaranteed or secure, therefore people should live their life to the best of their ability. Everyone wants the feeling of job security, but the reality is there is none. The rising unemployment rate amongst the United States citizens has been a major problem for a few years now that is greatly affecting our economy. The problem of the rise in the unemployment rate in the U.S can be solved by big business’ creating more jobs in their companies, banks approving more business loans for small businesses, and the government giving out stimulus packages to the people to help boost the economy. This is a problem that must be solved if the United States wants to move forward in a better economy. The spike in unemployment has pushed some private sectors to create more positions within their company, but it still isn’t enough to improve this difficult time the U.S. is facing. Irwin and Montgomery (2010) reported “private employers added only 83,000 jobs in June, the government said Friday, too few to keep up with growth in the working-age population” (p. 1). The employment rate is not getting better, but it is dropping at a slow gradual rate. Americans have practically given up on joining the labor force......

Words: 1297 - Pages: 6

Unemployment Rate

...about united states unemployment rate in the 2012 that fell sharply to its lowest level in last 4 years and resulted in controversial discussion among governers and politicians. U.S economy went through so much difficulty in recent years , rate of unemployment in the country was so high and governers effort weren`t that efficient to reverse the situation . this article mentiond about U.s economy which is in recession and George Bush presidency period is done and Barak Obama is New president of united states since 2009. Rate of unemployment was 10% in october 2009 and accordingto a realeased data which is started off with a nice surprise unemployment rate reached to 7.8% in2012. This big news sparked political debate over health of jobs market. Author supports the released news and stated that unemployment showed a more dramatic improvement but also mentioned that the number is based on a small survey and more volatile survey than the main payroll figures. This report had some positive results in stock market, this news pushed up stocks , with the dow jones industrial average rising 34.79 to close at 1361.15 . Author mentioned that the unemployment rate showed a dramatic improvement but the number is on small survey and can not be accurate but this article was published on summer and some others believed that this report is published in summer 2012 to demonstrate that Obama and Obamas `cabinet succeed over unemployment rate over the nation so......

Words: 727 - Pages: 3

Unemployment Rates

...Judith Lopez Lopez 1 English 103 Professor Kirkley April 17, 2014 Who is to Blame for the Unemployment Rate Many of us go to school to have better opportunities in life. We achieve an education to potentially have not only a worthy career but also an enjoyable one. The truth is that unemployment levels in middle age individuals have raised drastically. This affects all of us in a way we have yet to imagine. While some of us attend college, many of us are also part-time employees. We are most likely to work as routine producers. Rountine producers perfom various tasks from working in a warehouse to telemarketers and so on. Others may work as in-person servers such as waiters, sales persons, cashiers, ect. Little by little these jobs are vanishing and drying at a very rapid pace. So ask yourself, is it the governments responsibility to provide jobs for routine workers. In my opinion not only is it the governments obligation to provide an environment where job creation can occur but it is also the government’s responsibility to generate a society that is conducive to a successful lifestyle for its citizens. Afterall they have the ability to control some common factors associated with the problem such as tax credits, underwrititng exports, minimum wage, and immigration. Routine production in the United States wasn’t at all bad, in fact that’s how many of our parents made a living and sustained a household. The truth is that now things have drastically changed,...

Words: 1636 - Pages: 7


...Unemployment occurs when a person who is actively searching for employment is unable to find work. Unemployment is often used as a measure of the health of the economy. The most frequently cited measure of unemployment is the unemployment rate. This is the number of unemployed persons divided by the number of people in the labor force. Many different variations of the unemployment rate exist with different definitions concerning who is an "unemployed person" and who is in the "labor force." For example, the U.S. Bureau of Labor Statistics' commonly cites the "U-3" unemployment rate as the official unemployment rate but this definition of unemployment does not include unemployed workers who have become discouraged by a tough labor market and are no longer looking for work. The various schools of economic thought differ on their explanation of the cause of unemployment. Keynesian economics proposes that there is a "natural rate" of unemployment because the skills of laborers and the positions available are slightly out of sync even under the best economic conditions. Neoclassical economics postulates that the labor market is efficient if left alone, but that various interventions, such a minimum wage laws and unionization, put supply and demand out of balance. The nature of unemployment differs according to the level of economic development in a country. India is an underdeveloped economy. The following types of unemployment exist in India: 1. Rural Unemployment: India is...

Words: 700 - Pages: 3

Macroeconomics and Rate of Unemployment

...Macroeconomics and Rate of Unemployment Oria Cummings Embry-Riddle Aeronautical University Macroeconomics and Rate of Unemployment In essence, macroeconomics is the study of economy as a whole. Unlike microeconomics, which relates to the study of a single decision and ways it affects other economic variables, macroeconomics strives to understand aggregate economy and ways it is affected by changes in employment, local production, and inflation. Further, the government through the central bank and other bodies uses analytical models to understand changes in aggregate economic determinants such as economic growth or rate of employment thereby formulating policies that strive to accelerate economic growth. Understandably, one of the economic variables that help establish aggregate changes in the economy is changes in rate of unemployment. Unemployment refers to a number of persons ready and willing to work in particular type of a job at current market for pay but cannot secure one. In essence, unemployment as an economic indicator measures the health of the economy (Mercatus.org, 2016). For instance, high rates of unemployment indicate poor performing economy, while a decline in the rate of unemployment indicates a healthy economy or economic growth. Therefore, a measure of the rate of unemployment is an aggregate used to determine economic performance and changes that affect the overall performance of the economy. Therefore, this essay strives to elucidate aggregate......

Words: 1833 - Pages: 8


...solutions for the unemployment problem using Keynesian economics, which brought the idea of forcing the government to spend when the private sector cannot or not able to support adequate levels of economic expansion. Conservatism and its position On the other hand, conservatism which is a political and social philosophy that simply believes that there is something in life worth redeeming and they also think that the role if governments should be to provide the citizens the freedom they need to achieve their own goals. Conservatives in the United States believe in and support the free market solutions, and they suggest to reduce the government rules and restriction of the private job areas. Moreover, they do not agree with the government in terms of motivation spending or aiding. They want it to be a free market that can govern feat and failure. To do so, they suggested to reduce the income tax rate which is the main effect on the free market. Back in the 19th century, the conservatives have worked to stop the labour unions and tried to push the free trade by encouraging agreements. Some of these agreements are still valid and used by the party to support the free trade. They also demonstrated some agreement that reduces inflation. Political and economic issues facing the citizens based on poll data Most of the rich and wealthy citizens of the United States do not support the active side of the government that try to kill the high rates of unemployment, they......

Words: 758 - Pages: 4

Will It Get Any Better Soon?- Unemployment Rates

...Will It Get Any Better Soon? : Unemployment Rates Ariel Cooper Business Economics GM545 Summer 2011 alcoop86@gmail.com Chapter 16, Question 5 In the US economy there is always some level of unemployment present. There are people losing jobs, leaving jobs, taking temporary hiatus from employment, on a daily basis. For the purpose of this exercise will be taking an in depth look at what a specific type of unemployment entails. This unemployment type is called Frictional unemployment. Let’s begin by defining what frictional unemployment is; frictional unemployment refers to the “natural” unemployment of our economy. This is described as the transitional period in which people move from one employment position to another, sometimes experiencing up to a few weeks in between positions. (Stone, Core Economics, p. 443) During this period of time these people are frictionally unemployed, they may already have a new position waiting on them to start, or they may be holding out in search of a better employment opportunity. Frictional unemployment can also refer to when a business decides to promote a hiring freeze and does not bring in new talent due to the assumption that there are not enough qualified candidates, when in fact there are. We will now discuss why frictional unemployment is important to have in any economy. Frictional unemployment is important to have in the economy because there is a constant reallocation of resources from one productivity level to another...

Words: 1107 - Pages: 5