What is the Natural Rate of Employment?

[VetLegion]

Any ideas as to what is the natural rate of unemployment? And should we worry about it so much?

BTW., another thing - isn't talking about unemployment sending negative vibes via the choice of word? Why aren't employment figures quoted instead?

"This month employment is at 92% down from 96% percent in the same month last year".

Sounds less pessimistic than:

"This month unemployment is at 8% up from 4% in the same month last year.

Obviously, to a thinking person both sentences carry the same information. But for propaganda purposes, they are very different. Why is the first form never used?

[b etor]

to show that it's a problem.
if you read something positive, you arent liking to think of any negatives because your happy enough with the positive stuff.
but if u read something negative you think about it slightly longer cuz the issue is right there.

thats how i think anway.

[Impaler[WrG]]

This "natural rate of employment" idea of yours needs to be explained before you can get any kind of an answer or even understand an answer. What are the contexts and rules of employment, is their a minumum wage, whats the state of the overall economy etc etc. Without context your question is little better then asking what the Natural price of Milk is.

Unemplyment statistics are not even universaly agreed upon, in the US its the % of the working age force which is currently SEAKING a job. I've heard that in Europe it reflects the total adult population NOT WORKING for any reason.

[Pekka]

When the 92% stop paying the 8%, they can stop the propaganda.

[LordShiva]

Originally posted by Impaler[WrG]
This "natural rate of employment" idea of yours needs to be explained before you can get any kind of an answer or even understand an answer.

Actually, it's a well-defined macroeconomic term.

[Kontiki]

You mean what is it quantifiably? I don't think there is an exact number, or certainly not one people agree on. It's more an acknowlegment that there is always a certain level of unemployment even under ideal circumstances.

As for why unemployment is used rather than employment, I would say it's precisely because of what you said, except turned on it's head. In first world countries (and really, most countries except the total basket cases) a far greater proportion of the working age population is employed than unemployed. Therefore, changes in the unemployment rate are far greater on a percentage basis.

[VetLegion]

I mean some countries seem to have unemployment at 4%. Should all the rest of us panic?

It's around 15% here. I know, bad, but... how bad?

[Cort Haus]

Unemployment statistics are heavily manipulated in the UK. Huge numbers of people are 'on the sick' permenantly and many more are on meaningless courses.

A certain amount of residual unemployment is essential for 'liquidity' in the employment market, of course, and to keep wages down.

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PS - No offence b etor, but may I just point out that we generally write in full English here, not txt-spk, with full punctuation, capital letters where appropriate and vague approximations to correct spelling etc. You are clearly getting an education - so why not use it? Like I said, please don't take offence.

[Cort Haus]

Originally posted by VetLegion
I mean some countries seem to have unemployment at 4%. Should all the rest of us panic?

It's around 15% here. I know, bad, but... how bad?

Perhaps your government could take some lessons from ours in fiddling the figures.

[Victor Galis]

Because the employment rate is somewhere in the low 70%s.

[Kontiki]

Originally posted by VetLegion
I mean some countries seem to have unemployment at 4%. Should all the rest of us panic?

It's around 15% here. I know, bad, but... how bad?

One of the tennets of the NAIRU is that it varies from country to country and from time period to time period. It's very difficult to accurately compare one country to another given the different economic structures, politics and the way any given country calculates it's unemployment rate.

[b etor]

Originally posted by Cort Haus
PS - No offence b etor, but may I just point out that we generally write in full English here, not txt-spk, with full punctuation, capital letters where appropriate and vague approximations to correct spelling etc. You are clearly getting an education - so why not use it? Like I said, please don't take offence.

Very well then, I will type everything formally.
It wasn't txt-spk tho, it was more like IMing talk.
But okay, I'll type like you guys.
Eww, I hate capital letters... unless its all in capitals, then I like it.

[SlowwHand]

5% is considered the norm.

[Cort Haus]

Very well then, I will type everything formally.
It wasn't txt-spk tho, it was more like IMing talk.
But okay, I'll type like you guys.
Eww, I hate capital letters... unless its all in capitals, then I like it.

Not all capitals, please - that's shouting. Feel free to use long sentences and the word wrap feature, though.

Text messages are of limited length, and IMing talk has someone hanging around at the other end waiting for your bit, so in both of these cases there is reason for heavy abbreviating. On here though, we all like to show off our extensive literary talents and consider our posts to be eloquent masterpieces.

{edit : typo )

[SlowwHand]

You don't have to ramble though. I mean, feel free, but under no obligation.