What Is Forecasting? Describe One Method Each for Forecasting Labor

question 17

Essay

What is forecasting? Describe one method each for forecasting labor demand and supply.
The attempts to determine the supply of and demand for various types of human resources to predict areas within the organization where there will be labor shortages or surpluses is referred to as forecasting.An organization might use trend analysis to predict labor demand,constructing and applying statistical models that predict labor demand for the next year,given relatively objective statistics from the previous year.These statistics are called leading indicators -objective measures that accurately predict future labor demand.Analyzing transitional matrix is a statistical procedure that can be used for analyzing labor supply.This is a chart that lists job categories held in one period and shows the proportion of employees in each of those job categories in a future period.It answers two questions: "Where did people who were in each job category go?" and "Where did people now in each job category come from?"

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Definitions:

Adverse Supply Shock

A sudden and significant decrease in the supply of a good or service, which typically leads to an increase in prices and can temporarily boost inflation.

Short-run Phillips Curve

A graphical representation showing the inverse relationship between the level of unemployment and the rate of inflation in an economy over the short-term.

Inflation

The degree of uptick in the universal valuation of goods and services, weakening purchase potency.

Natural Rate

The unemployment rate at which the economy operates when it is at full employment, reflecting the long-term levels of unemployment due to structural factors in the labor market.