Unemployment
is generally defined as a situation in which persons who are willing and able
to work at the prevailing wage structure (level) are not employed. Unemployment
may result from many factors and may take diverse forms. Included in the
unemployment are job losers, that is,
persons who have been temporarily displaced out of job for one reason or the
other. We also have the new entrants (persons
who have worked full-time before but have been out of the labor force for some
time and have just re-entered the force and are actively looking for jobs) and
of course, the discouraged potential
workers, that is, persons who have given up looking for jobs because they
believe they can never get one that is commensurate with their training.
is generally defined as a situation in which persons who are willing and able
to work at the prevailing wage structure (level) are not employed. Unemployment
may result from many factors and may take diverse forms. Included in the
unemployment are job losers, that is,
persons who have been temporarily displaced out of job for one reason or the
other. We also have the new entrants (persons
who have worked full-time before but have been out of the labor force for some
time and have just re-entered the force and are actively looking for jobs) and
of course, the discouraged potential
workers, that is, persons who have given up looking for jobs because they
believe they can never get one that is commensurate with their training.
In
addition to these openly unemployed,
there are the semi-hidden unemployed “Semi-hidden”
“disguised” unemployment occurs when persons who are willing to work full
time are engaged in part-time employment and when trained workers are engaged
in jobs that require and qualifications
because they cannot get anything better.
addition to these openly unemployed,
there are the semi-hidden unemployed “Semi-hidden”
“disguised” unemployment occurs when persons who are willing to work full
time are engaged in part-time employment and when trained workers are engaged
in jobs that require and qualifications
because they cannot get anything better.
Measuring unemployment
Unemployment
is a stock concept and hence can be measured only at a point in time. For
example, we can measure the rate of unemployment in Nigeria as at December
2000. To get the unemployment rate, we must first determine the size of the
country’s labor force. The labor
force can be derived from the country’s working
population. The working population consists of persons in the country who
are in the working-age bracket (usually
16 to 65) and are well and fit to work (this excludes persons that are
institutionalized, such as those in mental hospitals, correctional
institutions, such as prisons and those in nursing homes etc). Of this lot,
some are engaged in special duties, i.e., military service, some others such as
married women, nursing mothers are engaged in own-home housework, while some
others have for various reasons, chosen not to work. The labor force defines the number of working-age persons who are
non-institutionalized and are working or willing to work.
is a stock concept and hence can be measured only at a point in time. For
example, we can measure the rate of unemployment in Nigeria as at December
2000. To get the unemployment rate, we must first determine the size of the
country’s labor force. The labor
force can be derived from the country’s working
population. The working population consists of persons in the country who
are in the working-age bracket (usually
16 to 65) and are well and fit to work (this excludes persons that are
institutionalized, such as those in mental hospitals, correctional
institutions, such as prisons and those in nursing homes etc). Of this lot,
some are engaged in special duties, i.e., military service, some others such as
married women, nursing mothers are engaged in own-home housework, while some
others have for various reasons, chosen not to work. The labor force defines the number of working-age persons who are
non-institutionalized and are working or willing to work.
Some
persons in the labor force are self-employed
(this include unpaid employees in their own business etc), others are
working for some employers of labor for wages while some are unemployed. The labor market consists of persons in the labor
force who are not self-employed (i.e. the suppliers of labor) and the various
employers of labor. IN fig. 8-1, we illustrate the difference between a
country’s working population and the labor force.
persons in the labor force are self-employed
(this include unpaid employees in their own business etc), others are
working for some employers of labor for wages while some are unemployed. The labor market consists of persons in the labor
force who are not self-employed (i.e. the suppliers of labor) and the various
employers of labor. IN fig. 8-1, we illustrate the difference between a
country’s working population and the labor force.
Given
that the size of the working population remains constant, the size of the labor
force can be varied (increased or decreased) as persons move in and out of the labor
force. If the prevailing real wage rate is high enough, some homemakers may
decides to enter the labor force; some others who had decided not to work may
rescind their decisions, while some full-time students may convert into
part-time studies. All of these will act to increase the size of the labor
market. Opposite movements can also occur if real wages are considered too
small. The Labor Force Participation Rule
(LEFP) shows the percentage of non-institutionalized civilian working-age
population that are employed or actively seeking employment. This rate varies
between sexes. For females, the LFPR is generally lower.
that the size of the working population remains constant, the size of the labor
force can be varied (increased or decreased) as persons move in and out of the labor
force. If the prevailing real wage rate is high enough, some homemakers may
decides to enter the labor force; some others who had decided not to work may
rescind their decisions, while some full-time students may convert into
part-time studies. All of these will act to increase the size of the labor
market. Opposite movements can also occur if real wages are considered too
small. The Labor Force Participation Rule
(LEFP) shows the percentage of non-institutionalized civilian working-age
population that are employed or actively seeking employment. This rate varies
between sexes. For females, the LFPR is generally lower.
The
working population consists of all persons that are not too young or too old to
work and are not institutionalized. The labor force consists of persons in the
civilian working populations who are employed or are willing and available to
work. The labor market consists of those in the civilian labor force that are
not self-employed and the various employers of labor. The unemployment rate is
measured as a percentage ratio of the number of unemployed persons to the labor
force.
working population consists of all persons that are not too young or too old to
work and are not institutionalized. The labor force consists of persons in the
civilian working populations who are employed or are willing and available to
work. The labor market consists of those in the civilian labor force that are
not self-employed and the various employers of labor. The unemployment rate is
measured as a percentage ratio of the number of unemployed persons to the labor
force.
The
size of the labor force can be increased or decreased as persons move into
panel B from panel A or as persons leave panel B for panel A.
size of the labor force can be increased or decreased as persons move into
panel B from panel A or as persons leave panel B for panel A.
To
calculate the unemployment rate, we must first decide on how long a person need
to be out of job before he/she van be considered unemployed. This of course,
will depend on the state of the economy and will vary with countries. Once this
is determined, persons willing and able to work at the existing wage rate and
have been out of job for periods above the acceptable duration, are considered
unemployed.
calculate the unemployment rate, we must first decide on how long a person need
to be out of job before he/she van be considered unemployed. This of course,
will depend on the state of the economy and will vary with countries. Once this
is determined, persons willing and able to work at the existing wage rate and
have been out of job for periods above the acceptable duration, are considered
unemployed.
Since
statistics on the number of unemployed persons are usually generated by
government agencies, the official unemployment rate figure may not reveal the
full picture of employment/unemployment. This is largely because of the
existence of a subterranean or
underground economy whose activities are not directly measured by
government statisticians. Persons operating in this economy are basically
involved in activities considered illegal, such as drug trafficking,
prostitution etc. the level of employment or unemployment and the “output”
generated by such economic are not taken into account when calculating official
statistics such as GDP, unemployment rate etc. Because of this and the
phenomenon of “hidden unemployment”, the
actual rate of unemployment is, in most cases, usually above the officially
reported rate.
statistics on the number of unemployed persons are usually generated by
government agencies, the official unemployment rate figure may not reveal the
full picture of employment/unemployment. This is largely because of the
existence of a subterranean or
underground economy whose activities are not directly measured by
government statisticians. Persons operating in this economy are basically
involved in activities considered illegal, such as drug trafficking,
prostitution etc. the level of employment or unemployment and the “output”
generated by such economic are not taken into account when calculating official
statistics such as GDP, unemployment rate etc. Because of this and the
phenomenon of “hidden unemployment”, the
actual rate of unemployment is, in most cases, usually above the officially
reported rate.
