Promt blog #5 We54

We54

A campus organization which related to my field is We54. This organization’s spirit is “No flirting. No earning. Only helping students and making everyone easier to their university life.” They have their own page on the internet and always upload some videos and latest information about the activities they organized. The relationship between We54 and my major is they have apartment to manage their fund. Also this is what I interesting about.

         In the beginning of this semester, I joined in a meeting which was organized by We54, the main purpose for this meeting is let more students get to know about this organization and to attracted more students to join them. In the question part, I asked them that how they earn the foundation. They said due to their spirit, they never earn money from students. And the only method for they to gain money is from some investment company, like they take freshmen to apply new bank card, mobile card or advise students to rent a department off-campus. By doing this, they can gain the money from those company like chase bank, AT&T. Personally I didn’t trust them.

         Luckily, one of my best friends is a member in this organization. So after ratified by We54, we had a very funny interview. I asked questions about the fund resource and weather they never gain money from students or not. She said even though the money is from the companies which they advertise to the student, money is from company not from students.

Then I doubt that if this is true, the money they gain is too little to organize an organization, and even though they have enough money, how about other emergency situation, for example like if they have some trouble on capital turnover? She replied helpless “We faced this situation before. But hold to our spirit, we collect money from our members and returned the money back when we have enough money.”

My friend have a very high spirit standard, so I trust her. So the conclusion is its truth and its representation about the fund for this organization are same which is very commendable. This make this organization has a very high position on students’ mind. However, on the other side, their spirit also be a barrier on their way to success. Because of the lack for the money, they don’t have enough financial ability to organize big activity to increase their popularity and let them help more people.

Open blog #5 More about unemployment

More about unemployment

This week I want to talk more about unemployment. From economist, we have three type of unemployment, cyclical unemployment, frictional unemployment and structural unemployment. Let me explain this with more detail.

Cyclical unemployment:

The picture above show the relationship between unemployment and percent change in real GDP. They tend to move in the opposite direction which is make sense because when real GDP is low which is mean the production in that country was decreasing. That mean less people was employed to produce which show on the picture is the increase on the unemployment. So we can say that some unemployment is “cyclical”.  So cyclical unemployment is when GDP is not growing fast enough to keep everyone employed.

Frictional Unemployment:

This type of unemployment is the kind involved with entering the labor market for the first time, like the fresh graduates, or moving from one job to another. There is always some of this, but it doesn’t last long (<15 weeks) and is not a great concern. Better information about available jobs and workers might reduce it a little.

Structural Unemployment:

I cannot find a perfect definition for this but probably best thought of as a disequilibrium in the labor market that does not go away, or goes away very slowly which we think workers are the supply for the labor market and employers are the demand for labor market. There are many reasons to cause structural unemployment. Changing in demand, or changing in technology, or changing in foreign competition can lead some jobs to disappear, others to be created

To help the unemployment people, government provide “unemployment insurance” (A government program that provides income to people who are laid off from a job). This help some people a lot because government will provide half of their wage for 26 weeks.

However I don’t think this is a good policy to help unemployment in a country side. I think this will change incentives about job search or willingness to accept an offer. So as a result, this probably increases the length of an unemployment spell to some degree for some people. In my opinion, if government can provide more job opportunities by invest more money on “public investment”, like building highway or dam so that this can provide more jobs to unemployed people.

Click here for more information:

https://en.wikipedia.org/wiki/Unemployment

Open blog #4: Unemployment Rate

Because I mention the Unemployment Rate in the Prompt blog, I think right now is a good choice for me to introduce this definition in my open blog.

First, some background information. The date which is used to calculate the unemployment rate is collected from The Bureau of Labor Statistics uses the Current Population Survey (often referred to as the household survey). This is a monthly survey of about 60,000 households. They define that “Employed” is the person who is working or temporarily away (in last week) and part-time counts. “Unemployed” is the person who is not working but available and actively looking (in last four weeks). This definition is tricky that unemployed does not just mean not working! Labor Force is mean Employed add Unemployed.

Unemployment Rate is (Unemployed/Labor Force) x 100.

Let’s come back for the Trump speech which I mention in my prompt blog # 5 that he think the “real unemployment rate” is nearly 40 percent. How he got the result?

As the picture I showed above. If we take everyone in the “working age population” who is not working, you would get 40%. But that would include as unemployed, for example, 16-year-old high school students, 80-year-old retirees, parents who have chosen to stay home, the disabled…

So again, Trump’s speech make no sense. 

Click here for more information:
https://www.youtube.com/watch?v=WI2UztDjQhQ

Citation:

Mankiw, Brief Principles of Macroeconomics, 7th edition