Question

5. Suppose that President Trump were to make the claim that “Our unemployment rate is falling from its level of 2 years ago, this is a strong positive sign of our economic health and vitality.” A Bureau of Labor Statistics report is released, confirming President Trump’s statement; however, the BLS report reveals that in addition to a falling unemployment rate, the labor force has declined as well.

A. You are tasked with job of producing a counter argument to President Trump’s claim of economic “health and vitality” and must do so at a level of Economics used in this course. What is your counter argument? Can you produce a numerical example that would cast doubt on President Trump’s claims?

B. You are tasked with the job of further supporting President Trump’s claim of economic “health and vitality” and must do so at a level of Economics used in this course. What is your counter argument to the claim made in part A. above?

Answer 1

The unemployment rate has been at its lowest since a decade in th US. It has been 4.1% as of December 2017. unemployment rate falling down certainly points towards one thing for sure- work force are now seeking /getting jobs for a living. And as lesser people are unemployed, more output will be produced in the economy and thus more income.

But falling unemployment rate does not always mean that labour/work force are getting employment or are employed. It does have one of the aspects of falling labur force. What if people are voluntarily not working, or there might be cut short in output, or the modernization of various industries?-that will definitely reduce the labour force in demand. This does not mean that the economy is healthy. If now the labour force is decling, people who are the only earning person in their family loses his job and thus he does not recieve any income, which decreases consumption/demand for goods and services, and thus lesser output and thus lesser job generation. people might also not voluntarily find job, which is very crucial for in economic health and vitality.