Changes

Persons are classified as '''unemployed''' if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. [http://www.bls.gov/cps/faq.htm#Ques5]

Persons are classified as '''unemployed''' if they do not have a job, have actively looked for work in the prior 4 weeks, and are currently available for work. [http://www.bls.gov/cps/faq.htm#Ques5]

According to some sources,{{who}} unemployment is when people are unable to find jobs at the prevailing wages for their skills and experience.  Economists refer to this as "involuntary unemployment." Voluntary unemployment is a normal process when people join the labor force (after leaving school, for example) or move to a new area.

"Involuntary unemployment" is when people are unable to find jobs at the prevailing wages for their skills and experience.  "Voluntary unemployment" is a normal process when people join the labor force (after leaving school, for example) or move to a new area.

[[Image:Unemployment.jpg|thumb|275px|left]]

[[Image:Unemployment.jpg|thumb|275px|left]]

Weekly estimates of unemployment use the number of persons filing new claims for unemployment insurance (UI) benefits.  Much more accurate data is based on large scale interview surveys, and is reported on the first Friday of the following month.  Since 1940 the monthly Current Population Survey (CPS) has been used. <ref>See [http://www.bls.gov/cps/cps_htgm.htm Bureau of Labor Statistics]</ref>

Weekly estimates of unemployment use the number of persons filing new claims for unemployment insurance (UI) benefits.  Much more accurate data is based on large scale interview surveys, and is reported on the first Friday of the following month.  Since 1940 the monthly Current Population Survey (CPS) has been used. <ref>See [http://www.bls.gov/cps/cps_htgm.htm Bureau of Labor Statistics]</ref>

==Types==

==Causes==

Three types of unemployment can be distinguished by their causes. '''Frictional''' unemployment is the normal churning of the job market; people enter the labor force from school or home, and spend time looking for the best job. '''Seasonal''' unemployment refers to jobs that operate at certain seasons, especially in the construction and tourism industries. Because teachers are paid during summer vacation, they are not counted as unemployed  in the summertime. The '''"normal unemployment rate'''" (frictional plus seasonal) is about 3% to 4%.  '''[[Unemployment insurance]]''' is designed to help people face frictional and seasonal unemployment.

Three types of unemployment can be distinguished by their causes. '''Frictional''' unemployment is the normal churning of the job market; people enter the labor force from school or home, and spend time looking for the best job. Most frictional unemployment is voluntary and is desirable to keep the economy working. '''Seasonal''' unemployment refers to jobs that operate at certain seasons, such as construction and tourism industries. Because teachers are paid during summer vacation, they are not counted as unemployed  in the summertime. The '''"normal unemployment rate'''" (frictional plus seasonal) is about 3% to 4%.  '''[[Unemployment insurance]]''' is designed to help people smooth over their financial needs during frictional and seasonal unemployment.  

'''Structural''' unemployment means a mis-match of jobs and workers. For example, there may be jobs in the cities and unemployment in mining or logging areas, but people are reluctant to move because of family ties.  There may be jobs available in some fields but people who are unemployed lack the necessary skills. This is a structural problem solved by migration, job training and education. Some structural unemployment is caused by policies such as the [[minimum wage]].

'''Structural''' unemployment is much more serious. It means a mis-match of jobs and workers. For example, there may be jobs in the cities and unemployment in mining or logging areas, but people are reluctant to move because of family ties.  There may be jobs available in some fields but people who are unemployed lack the necessary skills. This is a structural problem solved by migration, job training and education. Some structural unemployment is caused by policies such as the [[minimum wage]].

Finally--and most serious--is '''cyclic unemployment''' (as in [[Recession of 2008|2008-2009]] and the [[Great Depression]]), when the whole economy is sagging and businesses lay off tens of thousands of workers every day. A few new jobs are created every month but they are overwhelmed by the jobs that are lost.  In February 2009, the U.S. economy lost 651,000 jobs net (that is, jobs that disappeared outnumbered jobs that were created by 641,000). Through April 30, 2009, about 5.7 million jobs were lost in 2008-9.

Finally--and most serious--is '''cyclic unemployment''' (as in [[Recession of 2008|2008-2009]] and the [[Great Depression]]), when the whole economy is sagging and businesses lay off tens of thousands of workers every day. Some new jobs are created every month but they are overwhelmed by the jobs that are lost.  In February 2009, the U.S. economy lost 651,000 jobs net (that is, jobs that disappeared outnumbered jobs that were created by 641,000). Through April 30, 2009, about 5.7 million jobs were lost in 2008-9.

[[File:Un-0409.jpg|thumb|250px|update for April 2009]] [[Image:Job-loss-09.jpg|thumb|250px|US job losses January 1-March 31, 2009]]

[[File:Un-0409.jpg|thumb|250px|update for April 2009]] [[Image:Job-loss-09.jpg|thumb|250px|US job losses January 1-March 31, 2009]]

==Temporary unemployment==

==Natural rate==

[[Milton Friedman]] in 1968 introduced the concept of the "natural rate of unemployment," which is the rate generated by the economy which does not cause inflation or deflation.

Conservative economist [[Milton Friedman]] in 1968 introduced the concept of the "natural rate of unemployment," which is the rate generated by the economy which does not cause inflation or deflation.

Friedman notes:

Friedman notes: