Unemployment question?

if unemployment is increasing, what happend to the real wages in the medium run and in the short run

Answer:
mfitz67> We are NOT at record low unemployment. Get your facts straight ...

Stop believeing every lie you hear on Faux News. Unemployment was lower in Dec 2000 than at anytime since.
We're at record low unemployment about 4.5 percent get your facts straight....
Pincollector, in 2000 the rate was 4.0 so yes it was lower then today but right now it is decreasing not increasing, which is my point....
Pushes down wages.

Think of it this way: If there's an increasing pool of unemployed people who want jobs, then employers can afford to bid less for workers.
Unemployement is increasing because of:
Case A. Savings > Investment
Deflation is likely. Real wages (w/p) rise as p=prices slow down in the short run. In the medium run S=I and wages return to the equilibrium.
Case B. (Rise of population/Population) > ( Increase of production /Production) . Real wages are pulled down by excess of offer. Employment and wages will eventually rise.

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