Category: Business Essay

The rate of unemployment is one of the key concepts in macroeconomic theory. The fact that a person is unemployed simultaneously translates into a loss for this person, his or her family as well as his or her country as a whole. Unemployment is usually analyzed as a trend in order to evaluate the macroeconomic fluctuations, economic stability of a country and the overall macroeconomic snapshot of a particular economy. It is logical to analyze the rate of unemployment, since the it is in a given country, the more people in it work to the common macroeconomic benefits of the country and the less social expenses the government has to incur in a form of various unemployment benefits. Nevertheless, the level of unemployment is a very complex concept, which includes multiple controversial aspects. Thus, a quick view on the data regarding the level of unemployment may give a rather confusing picture a positive state of affairs, while the actual economic situation might explain the numbers quite differently. This essay applies the macroeconomic concepts of unemployment and economic fluctuations to the real-life economic situation of the USA through an analysis of the article “Unemployment Rates Are Far Below US Level in 16 States

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The article presents its author’s point of view on the situation with the rate of unemployment in the US in May. The main idea of the article is that the unemployment rate in 16 US states fell less than the national average of 4.7%. The author’s main idea is that low unemployment rates in many states may form a basis for wage growth. The article presents data on the unemployment rate in different US states. For example, he mentions that many of the states with low unemployment are relatively small. South Dakota, which belongs to the states with a small population, had an unemployment rate of 2.5%, the lowest rate in the whole country. Arkansas recorded the lowest unemployment rate since 1976, standing at the level of 3.8%. The states demonstrating a similar picture, where the rate of unemployment is substantially lower than the national average of 4.7% are New Hampshire (2,7%), Nebraska (3%), and Maine (3,5%). Nevertheless, there are bigger much states, like Colorado, Minnesota, Virginia, that also have relatively low rates of unemployment. The author mentions that those big states contain the major industries of the US economy. In particular, Colorado has an impressive information technology sector. Minnesota is famous for its strong medical industry. Virginia contains many federal government workers and contractors. The author suggests that when businesses have to work with less “supply” of the labor force (lower rate of unemployment means that fewer people are in competition for a given position), they tend to increase the wages in order to attract potential workers to their positions. The author of the article also mentions that the average hourly wage rose 2.5% compared to the figure from the last year. At the same time, the nationwide rate of hiring has actually slowed down. This increase is lower than the targeted 3.5% calculated by economists as the required pay rate increase to guarantee the healthy economic growth. But, the author mentions that it is still higher than the number of roughly 2%, which was the characteristic of the 7-year long recovery from the Great Recession in the economy. Thus, the author strives to demonstrate that current data does not show a bad picture. Even though these numbers are far from optimistic, they are likely to guarantee a steady rate of macroeconomic growth, which is a better state of affairs than what the USA had a few years ago.

The article analyzes three main concepts – the rate of unemployment, the change of an hourly wage, and the business cycle. The author of the article suggests that two concepts are interdependent and gives a substantial amount of attention to a particular correlation. At the beginning of his reasoning, he supposes that a decrease in the rate of unemployment in May is a possibl