When trying to determine if high unemployment is being caused by weak demand or by a mismatch between jobs and the skills of job seekers, economists look at the Beveridge Curve. It represents the relationship between the unemployment rate and the job vacancy rate. On a simple chart, vacancies are on the vertical axis and unemployment is on the horizontal…
The gently sloping Beveridge Curve for shorter-term unemployed looks pretty normal, as jobs become available, they are steadily filled:
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But the one for longer-term unemployed shows an outward shift, where jobs opening are not associated with lower levels of unemployment:
Choosen excerpts by Job Market Monitor from
via Turning the temporarily unemployed into the permanently disabled | AEIdeas.
Discussion
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