http://biz.yahoo.com/cnnm/080320/032008_initial_claims.html?.v=4
The United States is receiving more jobless claims than were expected this week. It is the highest level of unemployment claims since 2005. In the past four weeks, there is an average number of 365,250 people whom are claiming to be unemployed for the first time. This shows that they were never unemployed before, but they have just become unemployed. The United States were unsure if they were going into a recession, but according to the chief U.S. economist for Lehman Brothers, this sudden level of unemployment can be used to verify that they truly are in a recession.
In chapter five, we learned what it means to be unemployed and the different types of unemployment. When they are claiming to be unemployed it doesn’t just mean they don’t have a job. It also means they are looking for a job, but cannot get one. If they don’t have a job and they aren’t looking for one, then they are not unemployed, they are not in the labour force. In my opinion, I think the United States is suffering mostly from demand-deficient unemployment. People are getting worried about the economy and therefore are less willing to spend their money. This means less investments and less demand overall causing a shortage of jobs and economic activities.
The United States are going into recession, but it isn’t that bad as some might think. It is natural to have a recession after an expansion. It is just how the economy works and people should not be too worried about this. Their economy will come back in a year or two in my opinion since they are still a very powerful country and have lots of experience in dealing with problems. Also, the number of unemployed people may not definitely indicate anything about the economy. This number may have increased not because people are getting fired, but it may be people who have just decided to join the labour force.
3 comments:
I think the recession that the United States is going through will affect the world dramatically. United States was pretty much at the centre of all trades around the world; them having the greatest imports and exports. The slower economy will mean that there will be less money flowing around United States and ultimately leading to less money flowing out and into the country through international trading. Quite a large number of companies around the world will be affected and may result in lay offs causing these other countries to have an increase in unemployment. Although, if the recession were to happen in another country of less involvement in international trading then the impact would probably be a lot less.
This is a very intersting article. With United States receiving more jobless claims, it indicates that the economy is not doing so well. Meaning less are jobs are available for people, therefore, increasing the unemployment rate. I believe this may be the beginning of recession, which may ultimately lead to a depression. I also think the United States is suffering mostly from demand-deficient unemployment because there is not enough demand for the jobs that are available. In order for people to spend more, the government should increasing spending of decrease taxes. This way it will increase GDP and people will start looking for jobs again once the economy is doing well.
In my opinion, I believe that the economy of the United States is coming to a slowdown. Therefore, all the factors that affect the economy will decrease also, which includes the employment rate. The increase in unemployment rate in the United States is definitely caused by the economy going in a recession. The unemployment is caused much by companies and factories downsizing due to the lack of work that needs to be done. Lastly, I believe there will be a period of time before the unemployment rate decreases, because the economy requires some time to recover. I hope many companies would not lay off their workers, because the economy will continue to go downhill if this happens.
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