- Hurt
- Savers
- Lenders/ Creditors
- People on a Fixed Income (Elderly, Welfare)
- Helped
- Debtors
Cost of Living Adjustments (COLA)- Automatic wage increase when inflation occurs
- Ex- California
Unemployment- The failure to use available resources, particularly labor to produce desired goods and services
Labor Force- Those that are above 16 years of age and are able and willing to work
- Labor Force= Employed + Unemployed
- Not included in the Labor Force:
- Military
- Students
- Retired
- Disabled
- Homeworkers
- Mental Institutions
- Jail/ Prisons
- Those who are not looking for a job
Unemployment Rate- 4-5% = Full employment or Natural Rate of Unemployment (NRU)
- Unemployment Rate= (# of unemployed/ (# of employed + # of unemployed)) x 100
Types of Unemployment-
- Frictional- Those who are searching for a job
- Temporarily Unemployed
- In Between Jobs
- Have Transferable Skills
- Ex- High School Graduate, College Graduate, Laid off Workers
- Structural- Changes in the structure of the labor force that makes some skills obsolete
- Doesn't have transferrable skills
- Have to learn new skills to get a job
- Seasonal- Due to the time of the year and nature of the job
- Ex- Lifeguard, Construction workers, Santa Claus/ Easter Bunny impersonators
- Cyclical- Results from economic downturns such as recessions/ depressions
- As demand for goods and service decrease, demand for labor falls off and workers get laid off
Frictional + Structural = NRU
Full Employment means there is no cyclical unemployment
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