ABSTRACT
This chapter explains how unemployment can cause economic insecurity and the meaning of full employment. It also describes the major types of unemployment in the United States and how unemployment is measured. Some unemployment is considered normal, because some workers are changing jobs and temporarily unemployed; other workers have seasonal jobs; and younger workers entering the labor force for the first time often have difficulty finding initial employment. The chapter identifies the major groups that have relatively high unemployment rates and major approaches for reducing unemployment in the United States. Groups with high unemployment rates, as of 2011, include blacks, Hispanics, Native Americans, teenagers, older workers, and high school dropouts. Specific approaches for reducing unemployment or for assisting unemployed workers include the following: monetary policy, discretionary fiscal policy, unemployment compensation benefits, improved labor market information, employment and training programs, and tax credits. Monetary and fiscal policies have limitations in reducing unemployment.
