Definition of Full Employment

What does the term "full employment" mean? What is the definition of the term "full employment"?

"Full employment" occurs when everybody who wants a job at the current market wage is able to find employment.

"Full employment" does not mean that the unemployment rate is zero. At any given time, people will be moving between jobs, or people may be finishing a temporary job, or people may simply not want to work for whatever reason.

The lowest unemployment rate on record in the United States is 2.5%, and that was posted in both May and June of 1953. A 2.5% unemployment rate is as close to "full employment" as you are going to get - at a 2.5% unemployment rate, virtually everybody who wants a job has one.

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