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Measuring Unemployment

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Over at Mises Canada, my Saturday article worked through the finer points of a better way to discuss unemployment. One problem with current measures is that the actual unemployment rate has little bearing on how difficult it is to get a job. There are periods with high numbers of unemployed masses but with many people finding a job, and stagnant periods where not many people lack work, but not many unemployed people are able to find work either. I previously discussed some of the other problems with the common measures of unemployment here.

Even though the unemployment rate was still north of 8% in early 2012, the average number of unemployed finding work was a healthy 2%. Today the unemployment rate is lower, but there is also a lower percentage of unemployed people finding work. In short, even though the total employment situation might be better today than it was two years ago, the average unemployed worker is going to have a more difficult time finding a job.

In fact, the average unemployed worker today has about as good a chance of becoming

Read more here.

David Howden is Chair of the Department of Business and Economics and professor of economics at St. Louis University's Madrid Campus, and Academic Vice President of the Ludwig von Mises Institute of Canada.

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