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EMPLOYMENT AND UNEMPLOYMENT
EMPLOYMENT AND UNEMPLOYMENT
Cause of Unemployment
Seasonal
people who are not employed at certain times of the year (eg. Tourist guide)
Voluntary
people who choose not to work
Frictional
workers who are moving between jobs
Structural
long term changes in the structure of industry when some industries decline
Technological
capital taking place of labour (eg. Machines replacing workers)
Cyclical
demand for products fall so workers are laid off
Very Silly Fools Suck Their Chips
Consequences of Unemployment
Labour resources are wasted
economy is not using all its workforce
Cost to taxpayer
the more people who are unemployed, more more benefits tehy pay
Regional problems
If a large firm in a certain are closes lost of people will be unemployed in that area
Budget deficit
gov. loses tax revenue when people are unemployed, eg. from income tax
Excluded workers
people who are unemployed for such a long time can become excluded from the workforce
Social problems
can lead to depression, loss of status, stress...
Living standards are lower
Workers and their families have a lower income to live off
Definitions
Employment
when all those who are willing and able to work are in paid employment at the current wage rate
Unemployment
when workers who are willing and able to work are unable to find a job at the current wage rate
Measuring Unemployment
Claimant count
measures the amount of people who are claiming unemployment related benefits (eg. job seekers allowance)
Labour force survey
counts all those who are without any kind of job, including part-time but who have looked for work in the past month and are able to start work immediately
Economically active population
population of working age that is economically active (i.e. either in work or looking for work)
Labour force
DOESN'T INCLUDE: over 16 in full time education, retired, full time parents, military, sick leave, voluntary unemployment...