Jeremiah Dunphy
3/29/2017
Professor Pangeo
Principles of Macroeconomics
Unemployment Topic Paper
There are a variety of ways that we interpret unemployment and how as well as what its
effects on the economy are and society as a whole. A straightforward way that we interpret
unemployment is negatively. No one really thinks of unemployment as a good thing. One
important want for us to understand unemployment as economists is to measure it.
According to the textbook, measuring the rate of unemployment is the job of the Bureau
of Labor Statistics also known as the BLS. Every month, the department of labor produces data
that is on unemployment and it is also on other aspects of the of the labor market, some of them
include employment, the length of the average work week, and how long people are employed
for. (Mankiw 298) Measuring the rate of unemployment as well as factors of unemployment is
very important for economists to know.
This is because generally the more people that became jobless, and unemployed then we
tend to see a decline in the economy. When people do not work it puts a strain on the economy
because all the money that they would be putting back into the economy from working does not
end up happening.
Now there are two definitions that the textbook uses for people who are unemployed, the
first one is “unemployed” this “includes those who were not employed, were available for work,
and had tried to find employment during the previous four weeks. It also includes those waiting
to be recalled to a job from which they had been laid off.” Now the second category is in regards
to people who are not in the labor force which “includes those who fit neither of the first two
categories, such as a full- time student, home makers, and retirees.” (Mankiw 299)
Looking at these two definitions is important, because they are unemployed for several
reasons. In the first definition, they are unemployed due to their own faults, even though they are
available and looking for work they are still not employed. In the second definition, the category
of people who are unemployed are unemployed because they are pre-occupied with something
