What's it: The natural rate of unemployment (NARU) is the unemployment rate when the economy is operating at full employment. Sometimes, it is equated with the non-accelerating inflation rate of unemployment (NAIRU), which is the
Unemployment
How does Unemployment Impact Individuals, Society, Businesses, and the Economy?
Unemployment has wide implications. It doesn't just have consequences on the individual. But, it also impacts society, business, and the economy. For example, unemployment causes: Higher poverty and crimeDecrease in business revenueIncreased
Why does full employment not mean 0 unemployment
Does full employment mean no unemployment? The answer is no. When the economy operates at full employment, unemployment remains. The unemployment rate is not zero. Why not zero percent? Only the cyclical unemployment rate is zero percent during
Employment: Indicators, Importance, Policies to Achieve Full Employment
What's it: Employment refers to the condition of having paid work, as in the Cambridge Dictionary. We also use it to refer to the number of people who have a job (Cambridge Dictionary) or the extent to which a labor force is
Labor Force: Components, Why it Matters
What's it: Labor force refers to the share of the working-age population currently employed and those actively looking for work. The working-age population usually refers to those aged 16 to 64 years. However, in some countries, the definition
Labor Force Participation Rate: Formula, Influencing Factors, Impact
What's it: Labor force participation rate is the labor force's proportion to the working-age population. The labor force consists of working-age individuals who are currently employed and those who are not yet employed but are actively looking
Hidden Unemployment: Types, Causes, Effects on the Economy
What's it: Hidden unemployment refers to people who are unemployed, but not reflected in official unemployment rates. It includes those who stopped looking for work due to discouragement and those who worked but were underused. Sometimes, the term
Discouraged Workers: Meaning, Reasons, Impacts
Discouraged workers are people of working age who stop looking for work. They usually stop looking because they are discouraged after not finding a job. Because they are not actively looking for work, these people are excluded from the labor force
Voluntary Unemployment: Causes and Solutions
What's it: Voluntary unemployment is a situation where a person chooses not to work. This is related to choice and preference, not because a job vacancy is unavailable. In other words, individuals deliberately choose to be unemployed despite