The paper 'Unemployment in Texas' is a perfect example of a research paper on macro and microeconomics.
Analysis of particular business cases has been made in the research paper. The first case considered the situation with unemployment in Texas and the United States of America. It has been shown that the situation with employment is improving in the country after the global financial crisis. Second of all, Texas has been demonstrating better results in the employment area than the country in general. One of the reasons for such a situation is the state’s desire to base its development on the real economy. The second case has shown that even the simple decisions of a simple person may affect the overall economic situation in a country.
The first task of this research paper is to analyze unemployment patterns within Texas and compare them to the situation in the United States of America. The period from 2003 to 2013 has been chosen for the analysis. More than the 10-year period is going to help to discover and analyze trends in the chosen area in the last decade. It is believed that such a period is enough to evaluate some trends in employment. Also, such a period accounts for the recent global financial crisis and further recovery from it. By the way, this period allows smoothing out the trend, since it includes years preceding the crisis and exceeding it. Those two events have influenced significantly conditions of a national economy.
First of all, it is important to say that the amount of labor force has grown by about 18% for the analyzed ten years in Texas. The current number is about 13 000 000 citizens. The amount of labor force in the country, in general, has grown only by about 6% for this period. Therefore, the state demonstrates better results that a national economy. It means that this state is one of the drivers of the growth of the national economy of the USA. Of course, the growth of the labor force is not a key driver of economic growth. For example, a lot depends on the productivity of the labor force and its growth. However, the labor force is one of the main factors of production, and it lays down foundations for the consistent economic growth of the state. It is time to move on to an analysis of the unemployment rate.
“Unemployment rate is the percentage of the total labor force that is unemployed but actively seeking employment and willing to work” (Unemployment Rate Definition).
It should be said that the unemployment rate remains almost at the same level as it was ten years ago. It was almost 7% ten years ago in Texas. It is about 6% nowadays. The unemployment rate had been falling since the beginning of a new century. The pace of the fall is not tremendous, however. It is about 14%. However, the global financial crisis has changed the situation, and the peak of unemployment was reached in 2009 and 2010. The peak was 8.1-8.2% in 2009-2010 in Texas. The unemployment rate in the United States of America is 7%. It has grown from 5.8% in 2003. The dynamics of unemployment rates for both Texas and the USA can be seen in the following graph.
As can be seen from the graph above, the dynamics of the unemployment rate in Texas and the USA are quite similar. However, Texas is characterized by generally low unemployment rates. It proves the previous opinion about the better economic situation in the state.
Once again, a negative impact of the global financial crisis on a national economy can be considered. Finally, the labor force participation has grown for both Texas and the USA. However, the state has demonstrated better results again. The labor force participation rate in the USA has declined from 65.9 in 2004 to 62.8 in 2013. The labor force participation rate was 65.6 in Texas in 2013. Generally, it can be concluded that the situation with employment is better in Texas than in the country in general. The reason for it may be a fact that the local economy is based on the industries, which have been not significantly affected by the crisis. The state tries to base its economic development on sectors of a real economy, rather than financial. Such sectors are less vulnerable to the global crisis.
The second task of the research paper is to analyze the contribution of the different situations to GDP and economic growth. Frankly speaking, it is quite difficult to analyze the impact of the first situation on economic growth. On the one hand, a woman does not take charge for advice anymore. It means that she does not receive a full potential profit. Also, she does not pay a full potential amount of taxes. Respectively, it sounds reasonable to talk about the negative impact of this situation on the GDP and overall economic growth. On the other hand, they have created a family that will be able to generate additional economic value for a national economy. A final result will depend on a comparison of the mentioned two factors.
The second situation also has a controversial impact on GDP and economic growth. First of all, a tennis player will not receive payment, and it will be not reflected in the calculation of GDP. He will not spend this money and, respectively, contribute to the growth of GDP. However, the sponsor may invest this money in some other alternatives that will be beneficial for the economic situation in the country. Once again, a final result is going to depend on the correspondence between the two factors.
Finally, a positive influence on GDP and economic growth can be monitored in the last case. It is believed that new antipollution equipment is going to increase the efficiency of the overall business performance of a public utility. First of all, these are additional expenses that will be calculated in GDP. Calculation of GDP as a sum of expenditures is quite a widespread methodology in economics.
“GDP generally is defined as the market value of the goods and services produced by a country. One way to calculate a nation's GDP is to sum all expenditures in the country. This method is known as the expenditure approach and is described below” (Gross Domestic Product).
Second of all, it will improve the overall environment in an area. It is going to support the development of business in an area and boost economic development. In the end, such a step is simply inevitable in modern conditions, where are significant requirements for the so-called corporate social responsibility.
Several cases have been analyzed in the research paper. It has been shown that even simple minor decisions of people are able to affect overall GDP and economic growth. Also, the situation with unemployment in Texas and the USA has been analyzed. It has been proven that the situation in the state is better than in the country. Generally, Texas is characterized by better industrial structure and structure of employment, than the average state in the United States of America. That is why the state is one of the drivers of a national economy.
Bureau of Labor Statistics Official Website. Retrieved January 1, 2014, from http://data.bls.gov/timeseries/LASST48000003
GDP Computation. Retrieved January 1, 2014, from http://staffwww.fullcoll.edu/fchan/macro/2gdp_computation.htm
Gross Domestic Product. Retrieved January 1, 2014, from http://www.quickmba.com/econ/macro/gdp/
Unemployment Rate Definition. Retrieved January 1, 2014, from http://www.investopedia.com/terms/u/unemploymentrate.asp