Non-accelerating inflation buffer employment ratio

Non-accelerating inflation buffer employment ratio (NAIRU) is a measure of how many people are employed relative to how many people could be employed without causing inflation. Imagine that everyone in a city is employed and has enough money. Then if the city starts to hire more people, those new people will have more money and begin to buy more things. This will cause prices to go up, which is called inflation. The NAIRU is a measure of the number of people who can be employed without causing inflation.