Movements

• Breakdown of labour market = airport example from textbook
• Labour markets = don't lead to the same outcome in the aggregate level depending on location
• Year-to-year movements in the UE rate = closely associated with recessions and expansions
• How firms can decrease their employment = in response to a decrease in demand
• Firms rely = quits and retirements
• Firms laying off workers = only if the decrease in demand is particularly pronounced
• Don't like to lay off = drastically decreasing the motivation of the remaining workers
• Higher unemployment = lower hiring opportunities and a larger risk of layoff