waltt@mako.UUCP (Walt Tucker) (09/29/84)
>I find it hard to beleive that Reagan can be so blase about 8 million >unemployed people. That's why I'm not voting for Reagan. Simple economic theory states: FULL EMPLOYMENT implies that every person of working age *who wishes to work* is employed in an acceptable position. Notice the catch phrase highlighted by asterisks. All economists that I have ever heard state that "Full employment does not mean 100% of the workforce is employed." It is unlikely that a zero rate of unemployment could be acheived even with the most restrictive definitions. There is some minimal level of unemployment due to the structural, sociological, and demographic characteristics of the economy. If the economy is at full employment, there is typically still 3 classes of people that are unemployed: o those that do not want to work (chronically unemployed) o those in job transistion by their free choice (i.e. -- a person has quit a job and is now looking for another, but is unemployed in the meantime) (frictional unemployed) o new entrants into the job market (new entrants) Economists don't alway agree on the exact percentage of that these categories make up, but when the economy is at full employment, these categories still leave the economy with an unemployment level of between 3.5 and 7 %. To quote from one of my economics texts ("The U.S. Financial System: Money, Markets, and Institutions by George G. Kaufman"): "Moreover, it is likely that even such a minimum rate is not a constant, but changes over time. For example, in the 1950s and 1960s, many analysts considered anemployment rate of about 4 percent to be consistt with full employment in the United States. However, even though this rate has not been acheived since 1969, the economy has undergone periods of very rapid expansion and record rates of price inflation. In part, the higher rates of unemployment reflect changes in the compo- sition of the labor force that are independent of the state of the economy. Teenagers and adult women traditionally have had higher rates of unemployment that adult males because of greater inexperience, less training, more frequent voluntary entry into an departure from the labor force, or discrimination. And these groups have become more numerous in the labor force. In 1960, adult women represented 30 percent of the labor force, and teenagers 7 percent. In 1980, the proportion of adult women had increased to 38 percent, and teenagers to 9 percent. Unemployment among adult women has been 10 to 50 percent higher than for adult males in the postwar period, and for teenagers three to five times higher. It has been estimated that this change in the compostion of the labor force has increased the unemployment rate in 1980 that is comparible to a given rate in the 1950's by one percentage point. Thus, if full employment was considered to be 4 percent unemployment in 1960, the comparable unemployment rate in 1980 would be at least 5 percent." ANYWAY, my point is that economics is like any other sort of statistical analysis. KNOW WHAT THE FIGURES MEAN. So, if the workforce is about 110 million people (I think that's the latest U.S. Dept of Labor statistics), 8 million unemployed people represents slightly under 8 percent unemployed. If full employment still leaves 5 percent unemployed, this means that there are only 3 million people who are out of jobs who would rather be working. Granted, this is three million more that we would like, but it still the lowest that we have had for a number of years. -- yours in capitalism, Walt Tucker Tektronix, Inc. Wilsonville, O. P.S. -- Sorry to be so long-winded, I'll try and keep it shorter net time.
gino@voder.UUCP (Gino Bloch) (10/01/84)
[this line is unemployable] >> If full employment still leaves 5 percent unemployed, this means that there >> are only 3 million people who are out of jobs who would rather be working. >> Walt Tucker You say this after quoting an economist who says that SOME of the 5% are unemployed voluntarily. Did you notice that you contradicted yourself? -- Gene E. Bloch (...!nsc!voder!gino)
gino@voder.UUCP (Gino Bloch) (10/02/84)
[this line is unemployable] >> If full employment still leaves 5 percent unemployed, this means that there >> are only 3 million people who are out of jobs who would rather be working. >> Walt Tucker You say this after quoting an economist who says that SOME of the 5% are unemployed voluntarily. Did you notice that you contradicted yourself? -- Gene E. Bloch (...!nsc!voder!gino)