The unemplyment rate, which is a narrowly defined measure, inched downwards this month from 8.3% to 8.1%. While at first glance this may seem to be a good thing, this WSJ article points out why it may not. Do you think that this unemployment problem is worse for any certain group (income class, race, gender)?
Potential essay question: What do you think a surplus of workers will do to the wage paid to newly employed people? If you think future wages will adjust downward, how far down can they go? Will this surplus of workers ever cease to exist?
Actually, household income is falling for the third year in a row. We're now down to 1996 levels which has resounding effects for the economy. We know how this affects normal and inferior goods, but what does that mean for you and me? Depending on what's made domestically that could mean more or less demand for goods made at U.S. factories, which in turn affects income (again) . So, depending on the good (shirts, cars, food, etc..) this could be either a slippery slope or small a rough patch.
I want to dry your attention to a graphic on the side of this article because there are many interesting things to note. We'll talk about this in class, but isn't it interesting that even though income has fallen the amount of TVs per household has increased. Is TV an inferior good?
In Economix - a NY Times blog that looks at economics in everyday life there was this post on employment rates for people aged 16-24. While this is a macroeconmic statistic there are many microeconmic implications. What do you expect to happen to college and community college enrollment based on this? What then do you think could happen to tuition costs in the future?
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