Question

A. For each of the following people in the US, determine if he/she is

(i) employed; (ii) structurally unemployed; (iii) frictionally unemployed; (iv) cyclically unemployed; (v) not in the labor force but work eligible; or (vi) not work eligible

(Explanations are not required)

1. Lin lost her job due to a recession. The economy has recovered but she still cannot find a job. Her skills are not needed in the economy any more.
2. Tim has just relocated to Seattle, he is looking for a job with 10 interviews lined up.
3. Celine studies at North Seattle College. She has an online business selling hand-made cards.
4. Hans is an illegal immigrant. He works underground at a restaurant.
5. Jane has retired. She taught Japanese language to her grandchildren at home.
6. Andy was laid off due to a recession. He stops looking for a job.

Answer 1

a) Option ii Structurally Unemployed

Lin is facing Structural Unemployment. Structural Unemployment occurs when the skills of person become obselete and are no longer demanded by employers. Lin's skills have become obselete.

b) Option iii Frictionally Unemployed

Timi is facing Frictional Unemployment.Frictional Unemployment is also called search and wait unemployment. Tim has moved to a new place and he is actively looking for job as per his requirements.

c) Option i Employed

Celine will be considered as Employed. She has an online business of handmade cards. In the labor force, employment, and unemployment data published by the Bureau of Labor Statistics, most Current Population Survey (CPS) estimates of wage and salary workers include the incorporated self-employed. This is because, technically, the incorporated self-employed are paid employees of their corporation.

d) Option vi Not Work Eligible

Hans is working underground and becomes a part of underground economy. His employment is not officially reported to the concerned authorities. So, he doesn't not form part of labor force and is not work eligible. He is illegal immigrant.

e) Option vi not work eligible

Jane has retired and his teaching her grandchildren. She is not considered to be part of Labour force. The working age population is defined as those aged 15 to 64. This indicator measures the share of the working age population in total population who are willing and eligible to work.

f) Option v not in the labor force but work eligible.

Andy has stopped looking for work. So, he will be considered as Discouraged Worker.. And also he will no longer be considered as part of labour force.