00:01
Okay, we are going to be doing an analysis of different scenarios as they relate to the unemployment rate as well as the employment population ratio.
00:12
The unemployment rate as well as the employment population ratio.
00:17
Now, the unemployment rate is basically the percentage of the workforce that is employed.
00:23
Okay, the percentage of the workforce that is employed.
00:26
And by workforce, we generally refer to people who are, or adults who are between the ages of 16 to 64.
00:35
And then when it comes to the employment population ratio, this is simply the percentage of adult population that is employed.
00:46
Okay, so the percentage of adult population that is employed.
00:50
So those are the key differences here.
00:52
It is the base.
00:54
This one focusing on a particular range of adults, 16 to 16.
01:00
To 4 and this one focusing on the entire adult population.
01:07
So let's look at how different scenarios affect these measures of performance.
01:15
Workers look for jobs.
01:18
We are given in the scenario an auto company that has become bankrupt.
01:27
So workers obviously are laid off.
01:29
So question is, how is that? the unemployment rate and the epr are going to be affected.
01:34
Obviously, the unemployment rate is going to go up because the workers are still actively looking for the jobs.
01:41
And the epr goes down because we now have less number of people working in the entire adult population.
01:49
Okay, so we have increase in unemployment rate and a decrease in the employment population ratio.
01:59
Now, if another group of workers decide to quit looking for work even, how is the unemployment rate going to be affected? okay, the unemployment rate is going to be unaffected.
02:13
Why? because they no longer fall in the definition of workforce if they are not going to be actively involved in looking for jobs.
02:24
So the unemployment rate is not going to be affected.
02:27
But the employment population ratio is obviously going to go down because we have less number of people that are working as a proportion to the entire adult population.
02:42
Okay.
02:43
And another scenario, scenario number three, is when they graduates, we have a numerous number of students.
02:54
We have graduated, but they have not found jobs.
02:58
What happens to the unemployment rate? okay, the fact that before they were graduates, while there were still students, obviously they're not part of the definition of unemployment or the workforce...