Economic variable: Unemployment

Economic variable: Unemployment

Unemployment is one of the key economic variables apart from inflation and GDP. It is an economic indicator which helps significantly in gauging the health of the economy of the country. It refers to the number of or proportion of people who want to work and have the ability of it, but they are not able to get a job. A person in such a situation is considered to be unemployed. If the economic statistics of a country indicate a high level of unemployment, it can be reflective of a struggling economy where labor supply is higher than the demands of the employers. Unemployment has a range of social costs including those of a rise in crime and suicide rates and also in deterioration of health of those unemployed. There are basically four types of unemployment situations. These include frictional, structural, seasonal, and cyclical unemployment. Depending on the type of situation aspects such as who produces this economic variable and how often, varies. For example, seasonal unemployment is caused by changes in the calendar such as sales representatives hired for Christmas, or people hired for a sporting event might not have a job once that event ends.

Unemployment rates in US

The Department of Bureau and Labor Statistics reports the unemployment rate in the United States on a regular basis and provides with important data and information related to it, which help in gauging the health of the economy of the country. Following is a graph from the website that indicates the unemployment rate in the country of the last two years.

Source: http://www.tradingeconomics.com/united-states/unemployment-rate

From the graph, it can be seen that the rate of unemployment in US has decreased to 7.3% in the month of August 2013 which was earlier in July at 7.4%. The above also shows ...