Good Research Paper On Macroeconomics

Part 1: Unemployment rate

The month under consideration is February 2015. The unemployment rate was 5.5%. The unemployment rate for previous month (January 2015) was 5.7%. The overall unemployment rate went down by 0.2 points.
The unemployment rate for adult women for the month of February 2015 was 4.9% and for teenagers it was 17.1%. The unemployment rate for blacks in the month of February 2015 was 10.4%, 6.6% among the Hispanics and 4.7% among whites. In the previous month of January 2015, the unemployment rate of adult women was 5.1% meaning it went down by 0.2 points. The unemployment rate of teenagers was 18.8% in January 2015 meaning it dropped by 1.7 points. The unemployment rate of blacks was 10.3% in January 2015 meaning it increased by 0.1 point. The unemployment rate of Hispanics in January 2015 was 6.7% meaning it dropped by 0.1 point. The unemployment rate of whites in January 2015 was 4.9% meaning it dropped by 0.2 points.
The factors that make it difficult to determine unemployment rate are usually the methods used in measuring unemployment rate. Unemployment is defined as the number of people who are jobless, looking for a job for at least 4 weeks continuously and are willing and able to work if they get the job. This means that the people who are unemployed but occasionally look for employment or do not look for employment at all are not included in unemployment category. Others may look for a job continuously and reach a point and give up, they are also not counted as unemployed.
Unemployment is both a social and an economic problem. It is an economic problem because it is a sign of inefficient allocation of resources and this means that the productive sector cannot produce jobs for all the jobless people. One consequence of unemployment is that people will end up taking poor paying jobs. This leads to low income amongst households, which is an indication that people will save less. When people in an economy save less it means that little or no amounts can be invested which in the long run leads to an under developed economy. This is because an economy’s growth is measured by how much is saved and invested.
Some of the non-economic effects of unemployment are social problems such as crimes, low self-esteem, broken families, suicides, prostitution and drug dealing.
Unemployment affects all sectors of an economy, but the greatest losers are the households. When people are not employed, they have no means of meeting their basic needs. Another loser of unemployment is the financial institutions. When households are unemployed, they cannot save and hence they cannot access loans. Since majority of financial institution’s profits come from interest on loans, they would therefore struggle to remain in business when households are not able to apply for loans. Finally the government will also lose from unemployment because jobless citizens pose a threat to security. Furthermore, the government will need to spend more in order to provide public goods and subsidised social amenities like health care. This increased expenditure will lead to a deficit in the balance of payments prompting the government to borrow more from the external markets.

Part 2: Inflation rate

The month in consideration is January 2015 and the CPI-U for that month is 233.707 (unadjusted).
The inflation rate for the month of January 2015 was a percentage change of -0.7 points. The inflation percentage change of December 2014 was -0.3 points. This means that the inflation rate has reduced from by 0.4 points.
The items which had the greatest percentage change are motor fuel (-18.6) and gasoline (-18.7). The commodities which had the lowest percentage change are food (0.0) and energy (-0.1).
When there are high rates of inflation, both the economy and households will be affected. This is because high prices with little or no increase in the wages can stifle the economy through depreciation of domestic currency. Depreciation of domestic currency leads to capital outflow and exports become expensive. Expensive exports mean a reduction in foreign exchange which in turn negatively affects the economic growth of a nation. High prices coupled with low wages mean little or no savings and hence no investments.

Part 3: Unemployment Data by Labour Force Groups and Duration

Note: The figures of year 2014 have been calculated using average method.
In 1995, the unemployment by duration was relatively high compared to year 2000, 2005 and 2014. There has been a downward trend of unemployed people in the less than 5 weeks duration, although the difference is small except for year 2005 which shows a small upward trend. For unemployment duration between 5-14 weeks, unemployment was rising except for year 2000 which dropped drastically then rose again and it has been rising until year 2014. Unemployment duration between 15-26 weeks has also been rising since year 1995 except year 2000 when it dropped and then started rising again. The unemployment duration of 27 weeks and over was high in year 1995 and dropped in year 2000 then started having an upward trend until year 2014. From the table, is clear that unemployment duration was very low in year 2000 compared to year 1995, 2005 and 2014. From year 2005, unemployment duration has been rising until year 2014. Decreased unemployment rate in year 2000 is an indication that more industries came in operation which required much labour force. However, since unemployment by duration increased from year 2005, it means that no new industries came to operation and the available labour force was enough to serve the production capacities of those industries. There is an increasing trend in unemployment in year 2014 meaning no new industries came into operation and even if they did, the existing labour force would take up the jobs.
Downsizing operations meant that few jobs were available therefore people would take long getting job opportunities. It also meant that few qualified personnel were required for key operations of the organizations. In my opinion downsizing operations would lead to longer durations of getting a job. Therefore, people will stay unemployed for longer periods in each stage of the unemployment duration.

References

Council of Economic Advisers to the President. (2005). The Economic Report of the President 2005. Cosmo, Inc.
The Bureau of Labor Statistics of United States (2015). www.bls.gov/news.release/empsit.toc.htm