Employment Indicators

Lesson

Employment indicators provide insight into the labor market, including the number of people employed, the unemployment rate, and wage growth. These indicators can help investors make informed investment decisions and influence government policies.

Practice Question #1

Which of the following is NOT an employment indicator?

A) Unemployment rate

B) Consumer Price Index

C) Job creation

D) Wage growth

Select an option above to see an explanation here.

A) The unemployment rate is an employment indicator. B) The Consumer Price Index measures inflation, not an employment indicator. C) Job creation is an employment indicator. D) Wage growth is an employment indicator.

Terms

Employment:: The number of people currently working in an economy.
Unemployment:: The number of people actively seeking work but cannot find a job.
Labor force:: The total number of people who are either employed or unemployed.
Unemployment rate:: The percentage of the labor force that is unemployed.
Labor force participation rate:: The percentage of the working-age population that is either employed or actively seeking work.
Job creation:: The number of new jobs added to the economy.
Jobless claims:: The number of people filing for unemployment benefits.
Wage growth:: The increase in average wages over time.
Underemployment:: People working in jobs that do not fully utilize their skills or abilities.
Full employment:: The level of employment at which there is no cyclical or deficient-demand unemployment.

Practice Question #2

What is the labor force participation rate?

A) The percentage of the labor force that is unemployed.

B) The percentage of the working-age population that is either employed or actively seeking work.

C) The number of people filing for unemployment benefits.

D) The level of employment at which there is no cyclical or deficient-demand unemployment.

Select an option above to see an explanation here.

A) This is the definition of the unemployment rate. B) The labor force participation rate is the percentage of the working-age population employed or actively seeking work. C) This is the definition of jobless claims. D) This is the definition of full employment.

Historical Example

In the early 1980s, a major recession led to a significant increase in unemployment rates. This period saw high levels of joblessness, with many people struggling to find work. The situation eventually improved as the economy recovered, and unemployment rates began to decline.

Practice Question #3

What is underemployment?

A) The number of people who are actively seeking work but are unable to find a job.

B) The situation where people are working in jobs that do not fully utilize their skills or abilities.

C) The increase in average wages over time.

D) The level of employment at which there is no cyclical or deficient-demand unemployment.

Select an option above to see an explanation here.

A) This is the definition of unemployment. B) Underemployment is when people work in jobs that do not fully utilize their skills or abilities. C) This is the definition of wage growth. D) This is the definition of full employment.