33 Employment

Question 1

Employment

Answer 1

Number of people of working age in the population who are in work

Question 2

Employment rate

Answer 2

Proportion of the working age population in work

Question 3

Unemployment rate

Answer 3

Proportion of working age seeking work (economically active) but who do not have a job

Question 4

Voluntary unemployment

Answer 4

When an individual chooses not to accept a job at the going wage rate.

Question 5

Involuntary unemployment

Answer 5

When an individual would like to accept la job at the going wage rate but is unable to find employment

Question 6

Labour market participation rate

Answer 6

Proportion of working age people who are economically active (in employment or actively seeking )

Question 7

Economically active

Answer 7

Working age people where who are neither in employment nor unemployed and so are not part of the labour force

Question 8

Full employment

Answer 8

When all choose that are economically active and are willing and able to work have a job.
- economy is making effective use of its resource of human capital stock l. e. Labour force
- no spare capacity and will operate on PPC

Question 9

Labour force survey

Answer 9

Measure of Tue percentage of the workforce who are without jobs but are available for work, looking for work and willing to work

Question 10

Occupational immobility

Answer 10

Barriers to workers changing occupations

Question 11

Geographical immobility

Answer 11

Barriers to the movement of workers between regions

Question 12

Advantages of labour force survey

Answer 12

_ Measure can be used to make international comparisons

Question 13

Disadvantages of labour force survey

Answer 13

• surveying households and extrapolating data from a sample
• not July representative

Question 14

Claimant count

Answer 14

Measure of the number of people registered as unemployed and claiming job seekers annoyance

Question 15

Advantage of claimant count

Answer 15

• conducted cheapus and Cassius as government already has record of number of people claiming JSA

Question 16

Disadvantages of claimant count

Answer 16

• Excludes unemployed that are unable or unwilling to claim JSA
• not all countries have benefit system so can’t wake international comparisons

Question 17

Frictional unemployment

Answer 17

• Associated with job search (between jobs)
• frictional unemplyment normals exists to some degree and does not indicate any weakness in the economy
• short term

Question 18

Cyclical unemployment

Answer 18

• Unemployment that arises throughout the course of the economic cycle i. e . Recession
• demand for and supply of labour changes resulting in a lower demand sur labour during recession
• short term cause but car be damaging to fuel economy as a large number of workers cal be made redundant at the same time

Question 19

Demand - deficient unemployment

Answer 19

• Unemployment arises because of a deficiency in aggregate demand in the economy I,e. equilibrium level of output is below sou employment
• forms make workers redundant because they want to reduce their output in response to less demand,
• can be damaging because workers from a particular industry are all made redundant
• short term

Question 20

Seasonal unemployment

Answer 20

• Unemployment that arises during certain seasons of the year
• fruit pickers
• damage to the economy depends on the reliance on primary sectors
• Can signify structural weaknesses in the economic is it results greater long-term unemployment because it suggests occupational immobility

Question 21

Consequences of unemployment

Answer 21

-Lower gross domestic product- represents significant wastage of economic resources the loss of output could have effect knock-on effect of firms willingness ability to invest
- lower standards of living - household incomes fall consumers are not able to purchase products which would boost material living standards
- greater income inequality - structural unemployment can result in greater disparity
- pressure on gov finances - under pressure one to greater payments of benefits and lower tax revenue
- hysteresis effect- the deterioration of someone’s skills through long period of unemployment making them less productive und increase probability of long term unemployment
- higher rates of unemployment -more serious costs are likely to be
- long term unemployment - lower rate for longer time would might be more damaging than high rate for very short term
- Wages - one benefit from higher rate of unemployment - reduced wage rate and reduced wage inflationary pressure

Question 22

Effects of full employment

Answer 22

• Operating efficiently
• not experiencing negative consequences of high unemployment
• operating at full capacity runs risk of experiences demand-puII inflationary pressure when rise In AD
• workers in employment but not using skills to full extent - lower skilled job than qualifications