NYS Department of Labor showing 0% unemployment rate - why is this actually bad for the economy?
I've been reading about how economists say that having 0% unemployment is actually worse than having some unemployment around 3-5%. This doesn't make sense to me - wouldn't we want everyone to have jobs? I'm currently on unemployment myself after being laid off from my manufacturing job last month, and it seems like having zero people unemployed would be ideal. Can someone explain why economists and the NYS Department of Labor track this differently than what seems logical? I keep seeing articles about 'natural unemployment rate' but I don't understand how unemployment can be 'natural' when people are struggling to pay bills.
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Amara Chukwu
You're asking a great economics question! Zero unemployment is actually problematic because it indicates an overheated economy with no flexibility. Here's why: 1) No worker mobility - people can't leave bad jobs to find better ones because there are no openings elsewhere, 2) No room for economic growth since all labor is already employed, 3) Wages get driven up so high that inflation spirals out of control, and 4) Companies can't expand because they can't find workers. The 'natural rate' around 3-5% includes people voluntarily between jobs, recent graduates entering the workforce, and seasonal workers. Even in a healthy economy, some unemployment is normal and necessary for economic flexibility.
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Liam O'Sullivan
•That actually makes sense when you explain it that way. I guess I was thinking about it too simply - like everyone having a job = good. But you're right that people need to be able to change jobs without the whole system breaking down.
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Giovanni Conti
this is why I dont trust economists lol they make it sound like people being unemployed is somehow GOOD for society. meanwhile im over here trying to get through to NYS Department of Labor for 3 weeks about my claim status and they're probably celebrating that theres enough unemployed people to keep the economy 'flexible
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Fatima Al-Hashimi
•I get the frustration with not being able to reach NYS Department of Labor - have you tried using Claimyr? It's a service that helps you get through to actual agents. There's a demo at https://youtu.be/qyftW-mnTNI and the site is claimyr.com. I used it when my weekly claims were stuck in adjudication and got through same day.
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Giovanni Conti
•never heard of that but honestly at this point ill try anything. the regular NYS Department of Labor phone system just hangs up on you after being on hold forever
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NeonNova
Wait so if 0% unemployment is bad then does that mean the government WANTS some people to be unemployed?? That seems messed up. Like they're okay with people struggling as long as the economy stays 'balanced' or whatever. I've been filing my weekly claims religiously and doing my job searches like NYS Department of Labor requires but now I'm wondering if they even want me to find work.
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Amara Chukwu
•It's not that the government wants people to suffer - it's that some level of unemployment reflects a dynamic, healthy economy where people have choices. The alternative (0% unemployment) historically leads to economic crashes that hurt way more people. NYS Department of Labor absolutely wants you to find work, that's why they have job search requirements and workforce development programs.
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Dylan Campbell
My economics professor back in college explained it like this - imagine if every parking spot in the city was always full. Nobody could ever go anywhere new because there would never be a place to park when they got there. Same thing with jobs - you need some 'empty spots' so people can move around and the economy can grow and change.
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Sofia Hernandez
•thats actually a really good analogy, never thought about it that way
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Dmitry Kuznetsov
This reminds me of when I was on unemployment a few years ago and my cousin kept saying 'just get any job' but I was holding out for something in my field. Took 4 months but I found a much better position than if I had just grabbed the first thing available. Maybe that's part of what economists mean - people need time to find the RIGHT job not just ANY job?
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Liam O'Sullivan
•Yeah that's a good point. I'm doing the same thing now - I could probably get hired at a fast food place tomorrow but I'm trying to find another manufacturing position that pays decently. The NYS Department of Labor job search requirements actually encourage looking for suitable work in your field first.
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