Unemployment Data - from the Bureau of Labor Statistics (May 2013)
Actual figures For Homework
Total not institutionalized population over the age of 16 245.4 million 245 million
Employed 143.9 million 144 million
Unemployed 11.7 million 12 million
Working part time - want to work full time 7.9 million 8 million
(included in employed above)
Working part time - do so by choice 2.7 million 3 million
(included in employed above)
Discouraged workers 0.8 million 1 million
Marginally attached (not including discouraged) 2.2 million 2 million
A. Use the data above to answer the following questions. To simplify the calculations use the rounded numbers in the second column. Round all numbers off to one decimal place. For example, 23.27 should be entered as 23.3
1. The labor force in May 2013 was equal to __________ million people.
2. The labor force participation rate in May 2013 was ________ percent.
3. The unemployment rate in May 2013 was __________ percent.
The number found above is the most often reported official unemployment rate known as U3.
Other official unemployment rates include discouraged workers, marginally attached workers and people who are counted as employed because they are working part time but want to work full time. Calculate these rates below. Hint: When you add discouraged workers to the number of unemployed, you must also add them to the labor force before calculating the unemployment rate U4. Do the same with U5. On #6 (calculating U6) you would not add the part timers who want to work full time into the labor force to calculate U6 because they were already included in the employed. Now they would be considered unemployed instead of employed but you don't need to add them to the denominator since they are already in the total. (You do add them to the unemployed - the numerator of the ratio you take to get the unemployment rate).
4. U4 is equal to U3 plus discouraged workers. U4 in May 2013 was _______________ percent.
5. U5 is equal to U4 plus marginally attached workers. U5 in May 2013 was ___________ percent.
6. U6 is equal to U5 plus those people who are only working part time but want to work full time. U6 in May 2013 was _________ percent.
What you should note at this point is how different the rates U3 - U6 are.
7. The reported unemployment rate (U3) __________________ (understates, overstates) the amount of unemployment in the economy. In your opinion (U3, U4, U5, or U6) _________ is the best measure of total unemployment in the economy.
E. Sarah currently works for a firm in which her union has negotiated a cost-of-living adjustment that automatically adjusts her income to whatever the annual rate of inflation is for her community. Bob works for a firm that routinely grants its employees a 5% annual income increase. Milt is retired and receives two payments: a pension payment from his former employer that is fixed at $2,000 per month and a government provided retirement payment whose real value is equal to $1,000 per month in the base year. The government provided retirement payment is indexed to the inflation rate in the community (it increases by the same amount as the rate of inflation each year).
Answer the following questions. Fill in the blanks with Sarah, Bob, or Milt. If the situation applies to more than one individual put each name in the blank separated by one space (no commas). If it does not apply to anyone put no one in the blank.
Suppose the rate of inflation is 3% this year. (Sarah, Bob, Milt, no one) _________ will be better off than last year, while (Sarah, Bob, Milt, no one) ____________ will be as well off as last year, but no better, and (Sarah, Bob, Milt, no one) __________ will be worse off than last year.Suppose the rate of inflation is 7% this year. (Sarah, Bob, Milt, no one) _________ will be better off than last year, while (Sarah, Bob, Milt, no one) ____________ will be as well off as last year, but no better, and (Sarah, Bob, Milt, no one) __________ will be worse off than last year.
D.Sustainability: The table below shows the percent change in verified emissions of carbon dioxide (CO2) and the percent change in real GDP per capita for selected EU countries.
|
Country
|
Per cent change in real GDP per capita 2005 - 2007
|
Per cent change in CO2 emissions 2005 - 2007
|
|
Austria
|
6.30%
|
-4.90%
|
|
Belgium
|
4.19
|
-4.60
|
|
Cyprus
|
5.56
|
6.20
|
|
Finland
|
9.23
|
28.50
|
|
France
|
2.76
|
-3.50
|
|
Germany
|
5.79
|
2.50
|
|
Greece
|
8.09
|
2.00
|
|
Ireland
|
6.56
|
-5.30
|
|
Italy
|
2.28
|
0.20
|
|
Luxembourg
|
8.55
|
-1.40
|
|
Netherland
|
4.61
|
-0.60
|
|
Portugal
|
2.67
|
-14.40
|
|
Slovenia
|
11.79
|
3.80
|
|
Spain
|
4.28
|
1.60
|
Source: European Commission Press Release, May 23, 2008; International Monetary Fund, World Factbook 2008.
Rank the countries in terms of the percentage increase in real GDP per person, from highest to lowest. Note the six countries with the highest percentage increase in real GDP per capita. Which six countries have the lowest percentage increase?
Rank the countries in terms of percentage increase in CO2 emissions, from highest to lowest. Note the six countries with the highest percentage increase in emissions. Which six countries have the lowest percentage increase in emissions?
Compare your two lists.
Would you infer from your results that CO2 emissions are linked to growth in output per person? (yes, no) ________ (This means that countries ranking high in GDP growth tend to rank high in CO2 emissions or they tend to rank low in GDP growth and low in CO2 emissions.)
Do high growth rates necessarily lead to high CO2 emissions? (yes, no) ________
If not, name two countries that prove a high growth rate does not necessarily lead to high CO2 emissions: _____________________ and ____________________.
(Hint: These countries should be in the top six for increases in real per capita GDP and in the lowest six for CO2emissions or in the bottom six for increases in real per capita GDP and in the top six for CO2 emissions.)