Chapter 28’s main focus was on unemployment and how to calculate the percentages of those working to the labor force and the labor force to the adult population. Overall, these concepts were relatively easy to understand through the way book describes the topics and the examples it provides. Rating would be a 1.5/3.
This chapter was longer than the others, but the book does a great job in making sure the information is clear and shows connections to real life effectively. the book also defines the two different kinds of unemployment, frictional and structural. Frictional unemployment is due to wanting to find a job that suits your tastes and it always changes via a change in taste otherwise known as sectoral shifts. Structural unemployment is a lack of wanted jobs in certain labor markets due to an increase in wages.
One reason for unemployment is the time it takes workers to search for jobs that best suit their tastes and skills. This frictional unemployment is increased as a result of unemployment insurance, a government policy designed to protect workers' incomes. A second reason our economy always has some unemployment is minimum-wage laws. By raising the wage of unskilled and inexperienced workers above the equilibrium level, minimum wage laws raise the quantity of labor supplied and reduce the quantity demanded. The surplus of labor represents unemployment.
A third reason for unemployment is the market power of unions. When unions push the wages in unionized industries above the equilibrium level, they create a surplus of labor.
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