• Under-employment: under-utilization of labor which is missed by most official (governmental agency). For an example of under-employment follow this link

• Full employment: When the labour market is in equilibrium. Where everyone who is supplying their labour has a job. Note that this is not the same as zero unemployment as some people may be unwilling or unable to supply their labour at the market equlibrium wage level

• The Natural rate of unemployment. That level of unemployment that occurs when their is full employment and the labour market is in equilibrium. (Economist article on NRU -requires subscription)

Measuring Unemployment

Here is a link

http://www.tutor2u.net/economics/revision-notes/as-macro-employment-unemployment.html

Open this and go to the link Measuring Unemployment. Make notes on the different measures of unemployment (the Claimant count and the LFS) The key thing to note is that often it is difficult to accurately measure unemployment because:

• There is often hidden unemployment due to "discouraged workers".

• Often people are underemployed but not unemployed. This is still a major problem even though it would not appear in the data.

• Some people may be registered as unemployed but working in the "black economy" where incomes are undeclared.

• Unemployment figures do not take into account whether it is long or short term unemployment

• Unemployment figures do not take into account regional, ethnic, age or gender disparities. For example unemployment rates may be low, but amongst 18-25 yr old males living in the North of England from Ethnic minority groups, unemployment may be a serious problem

Costs of unemployment

watch the video  below and note all the different costs of unemployment

ECONOMIC COSTS OF UNEMPLOYMENT

Then go to the Economist link at:

http://www.economist.com/finance/displayStory.cfm?story_id=2424216

Why are so many people not working in Europe? ( you need an account to access this)

Government policies to reduce Unemployment

And another data response question on unemployment etc.

Economics SL paper 2 May 05