Inflation, Labor and Unemployment
Labor force refers to the available human resources, whether employed or unemployed, including those who are atleast 15 years old.
When a part of this labor force is unemployed, it means there are persons who are willing to engage in productive activities yet fail to do so (at least for the past 4 weeks).
Underemployment is where a worker is employed, but the job only requires skills or expertise levels that are lower that his level.
There are two type of underemployment:
Visible Underemployment is where an employee works for less than 40 hours and is willing to work for more.
Invisible Underemployment is where an employee works for more than 40 hours and is willing to work for more. This is the result of wages lower than what he deserve.
Inflation and the Types of Inflation
Inflation is an uninterrupted increase in the price of goods and services for a period of time. This is normal in developed and developing nations where price stability is hard to achieve. In this condition, the overall price, not the relative price, increases.
There are two types of Inflation
Cost Push Inflation comes from a continuous increase in the cost of Production, an example of which is the increasing price of Oil in the World Market.
Demand Pull Inflation comes from an excess demand of goods and services. An example is the tendency of the arctic countries to order more fuel whenever there is an increase in its cost, further increasing the price of out.