Economic_Indicators

Economic Indicators Research Paper Unemployment According to the Bureau of Labor Statistics the number of unemployed persons (13.9 million) and the unemployment rate (9.1 percent) were essentially unchanged in May. The labor force, at 153.7 million, was little changed over the month. In May, the number of long-term unemployed (those jobless for 27 weeks and over) increased by 361,000 to 6.2 million; their share of unemployment increased to 45.1 percent. (BLS) The economy is growing again and creating some jobs, but it is still not very promising to the 13.9 million U.S. workers who remain unemployed. Though employment is increasing, it is not increasing at a rate that will replace the millions of jobs lost during the recession for many years. However, the unemployment rate is a lagging indicator. This means it measures the effect of a recession[->0] and so occurs after one has already started. It also means unemployment will continue to rise even after the economy has started to recover. Employers are reluctant to lay people off when the economy turns bad. For large companies, it can take months to put together a layoff plan. Companies are even more reluctant to hire new workers when the economy improves. For that reason, the unemployment rate can only confirm what the other indicators are already showing. For example, if the other indicators show a quickening economy, and the unemployment rate is declining, then you know for sure businesses are confident enough to start hiring again. Since it is a lagging indicator, unemployment can worsen even after the economy starts to improve. In the last recession, unemployment went from 5.6% in 2002 to 6% in 2003, even though the recession ended in 2002.(Unemployment) These numbers are not very reliable as they are only counting the number of people who actually looked for work. They do not include the number of those people who got tired of looking and just gave up or quit looking all together. The statistics are good for predicting and showing the overall business performance. However there is no way to tell the numbers exactly because they only include those actively looking for work. Works Cited "Current Population Survey (CPS)." U.S. Bureau of Labor Statistics. Web. 25 June 2011. . "Unemployment Rates - What Is the Unemployment Rate in the US." US Economy and Business - US Economic Indicators - US Economic News. Web. 26 June 2011. . [->0] - http://useconomy.about.com/od/grossdomesticproduct/f/Recession.htm