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Zero unemployment would be bad because it would imply there’s no churn of people leaving one job for another. Back last year when unemployment was 3.5% most of
by ls612 6y ago
Zero unemployment would be bad because it would imply there’s no churn of people leaving one job for another. Back last year when unemployment was 3.5% most of that is people choosing to leave a job to find a new one.
- sudosysgen 6y agoIt is not necessary to be unemployed for an extended amount of time in order to change jobs.
- ls612 6y agoBut on average a few percent of people will be unemployed at the moment the survey week is conducted. And that is what the unemployment rate is measuring.
- sudosysgen 6y agoLet's look at this mathematically. If the average person changes jobs every four to five years, and spends two-three weeks unemployed doing so, as they already have a plan for their next job, you would expect a job-related unemployement rate of around 1% due to job changes.
- ls612 6y agoIn practice it makes up around 2%. The remainder in good times is people who were just fired, a few layoffs (since even in booms businesses can fail) and a few people entering the workforce.
- sudosysgen 6y agoSure. That is less than half of the normal unemployement rate.