As Figure 1-2 shows, unemployment represents an underutilization of resources. Before giving the details of unemployment we should note that macroeconomic policies do not desire to provide all individuals with jobs. Some people choose to be unemployed voluntarily . Individuals may choose to be unemployed as they switch jobs, move from on region of the country to another, or for various other reasons. The goal of macroeconomic policy is to achieve full employment .
Full employment is described as the absence of involuntary unemployment.
Involuntary unemployment is that characterized by individuals who would like a job that matches their skills, but none are available. This may sound clear, but the study of economics is often the examination of shades of gray. The thorn in the side of economic policy-makers is the difficulty of determining what is an appropriate level for full employment. Measuring Unemployment To measure unemployment we must first consider those people who are considered eligible to work. Excluded from the labor force are students, housekeepers for a working spouse, those who have given up looking for work, and others who are considered non-labor force participants.