Employment
Economically active people in paid work.
Employment and unemployment
Key definitions
Unemployment
Without work, available and actively seeking work.
Economically active
Employed plus unemployed (labour force).
Economically inactive
Not seeking work (students, carers, retired, etc.).
Claimant count
Those claiming unemployment-related benefits.
ILO/LFS measure
Survey-based unemployment rate.
Frictional unemployment
Short-term between jobs.
Structural unemployment
Skills/geography mismatch — most worrying in LR.
Cyclical unemployment
Caused by deficient AD in downturn.
NAIRU
Unemployment rate consistent with stable inflation.
Key concepts
Unemployment inside the PPF shows spare capacity.
Classical vs Keynesian views differ on wage flexibility.
Use UK unemployment statistics.
Relevant tips
- Classify unemployment type before recommending policy.