Question

In this case study you investigate how good the official ‘unemployment rate’ captures the unemployment in the economy.

You should reference the two articles provided on this subject above, the material in your textbook related to this topic and one more article of your choosing. Address the following questions in your paper:

1. Does the official unemployment rate capture the true unemployment in the economy?

2. What are the ways to address any flaws in the report?

Answer 1

The bureau of labor statistics has different ways of measuring unemployment numbers but they do not give real number.The true unemployment rate can never be calculated with the existing technology.The figures of true unemployment rate that are published , are statistical abstractions.They are good at measuring macro changes in the national employment . These measurements are not useful if a person is unemployed and not able to find a job to support the basic needs of life.

The measurement of unemployment is prone to errors .It is necessary to factor in the unemployment rate of individuals who are looking for employment,individuals who are self employed,those who take early retirement,those with disability pension and who would like to work etc.Some individuals also choose not to enter labor force and they should be factored in. All unemployed and underemployed individuals should be included.