Zapošljavanje i nezaposlenost

Unemployment

• Unemployment is classified into two categories:
  • Long-term problems: natural unemployment rate
  • Short-term problems: cyclical unemployment

Measuring Unemployment

• The Republic Institute of Statistics conducts surveys.
• A survey of randomly selected households (approximately 15,000).
• The survey covers individuals aged 15 and older.
• Based on their responses, individuals are categorized into three groups:
  • Employed
  • Unemployed
  • Not in the labor force

Labor Force

• The labor force is the total number of workers, including both employed and unemployed individuals.

Employed

• An individual is considered employed if they worked for pay during part of the previous week.

Unemployed

• An individual is considered unemployed if they are temporarily laid off, actively seeking employment, or waiting for a new job to begin.

Not in the labor force

• An individual who does not fit into either of the above categories (e.g., students, homemakers, retirees).

International Labour Organization (ILO) definition of unemployment:

• An individual is considered unemployed if they are without a job, are willing to begin work within two weeks, and have actively sought employment in the previous four weeks or are waiting to begin work.

What does the Unemployment Rate Actually Measure?

• The unemployment rate is not a perfect indicator of the labor market.
• It does not include discouraged workers.
• It does not differentiate between full-time and part-time jobs.
• Some people may intentionally provide inaccurate employment status information.

Cyclical Unemployment

• Represents fluctuations in unemployment around the natural rate.
• Related to short-term ups and downs in economic activity.

Frictional Unemployment

• Unemployment caused by time needed to find a suitable job that matches skills and preferences.
• Short-term for most people.

Structural Unemployment

• Unemployment due to a lack of available jobs in certain labor markets.
• Often long-term.

Job Search

• Workers have different preferences and skills, and jobs have different characteristics.
• Job search is the process where workers find jobs that meet their preferences and skills.
• Sectoral shifts (changes in demand across industries or regions) can leave some workers without suitable jobs, requiring them to search for new ones.

Unemployment Insurance

• Government programs to partially support the income of laid-off workers.
• Increases frictional unemployment as it reduces the incentive to actively find a job.

Minimum Wage Laws

• Minimum wage laws set a floor on wages.
• If the minimum wage is set above the equilibrium wage, it can lead to a surplus of labor and consequently unemployment.

Unions and Collective Bargaining

• Unions are worker organizations that negotiate with employers on wages and working conditions.
• Collective bargaining is the process of negotiation between workers and employers.
• Unions often strive for higher wages and benefits than employers would offer without a union.

Efficiency Wage Theory

• Firms may find it profitable to pay wages above the market equilibrium to increase worker productivity.
  • Better health
  • Reduced job turnover
  • Increased worker effort/motivation
  • Attracting higher-quality workers

Money and Monetary Systems

• Money is anything widely accepted in exchange for goods and services.
• It serves three key functions:
  • Medium of exchange
  • Unit of Account
  • Store of Value
• Liquidity is how easily an asset can be converted to cash. Cash is highly liquid.

Types of Money

• Commodity money: has intrinsic value (e.g., gold, silver).
• Fiat money: has no intrinsic value, but is accepted because the government decrees it as legal tender (e.g., paper money).

Money Supply (M1 and M2)

• M1 includes currency in circulation, demand deposits, and other checkable deposits.
• M2 includes M1 plus savings accounts, money market deposit accounts, and small time deposits.

Banks and Fractional Reserve Banking

• Banks receive deposits and lend some of those funds.
• Fractional reserve banking: Banks keep only a fraction of deposits in reserve, lending the rest.
• Reserve requirement: The fraction of deposits that banks must hold in reserve.

Central Banks

• Central banks control the money supply (e.g., the Federal Reserve in the United States, the European Central Bank).
  • They can affect the money supply by changing reserve requirements, conducting open market operations, and adjusting interest rates.

Monetary Policy

• Actions undertaken by a central bank to influence the money supply and credit conditions to stimulate or restrain economic activity.
• Used to stabilize the economy (e.g., to mitigate inflation or recession).

Inflation and Demand-Pull Inflation

• Inflation is a sustained increase in the general price level of goods and services in an economy over a period of time.
• Demand-pull inflation is when the demand for goods and services exceeds the economy's capacity to produce them.

Quantity Theory Of Money

• This theory proposes a relationship between the money supply, the velocity of money, the price level, and the output of an economy.

Consequences of Inflation

• Money loses value over time.
• Unexpected inflation redistributes wealth.