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To protect themselves from catastrophic losses, insurance companies buy insurance, in the same way that people do. These contracts are called reinsurance agreements, and come in two main forms: proportional and nonproportional contracts. In proportional reinsurance contracts, a reinsurer agrees to repay a fixed proportion of losses incurred by the primary insurer. The simplicity of the agreement makes these types of contracts inexpensive and easy to administer. Therefore, they can be ideal risk-management tools for small insurance companies.
Is There Still Slack in the Labor Market?
Daniel Aaronson, Scott A. Brave and David Kelley
Based on recent population and labor force projections, we estimate that payroll employment remained about one million jobs below its trend as of April 2016. Given an average pace of roughly 200,000 jobs added per month so far this year, this implies that labor market slack is likely to persist until late 2016. Considerable uncertainty surrounds this estimate, however, especially with respect to labor force trends. An alternative calculation that assumes a steeper decline in trend labor force participation driven by shifting demographics suggests that slack could persist for up to an additional year.
Over the past quarter of a century, the share of jobs in the U.S. economy in manufacturing has declined, while the share of jobs in services has risen. A common view is that because manufacturing jobs are relatively high-paying jobs, this shift has been negative for workers. However, jobs also differ in other ways, so looking only at pay gives an incomplete picture.