Employment and Unemployment

Question 1

What is the L.F.S

Answer 1

A survey mandatory for all E.U countries to conduct which measures unemployment by the ILO’s definitions of employed, unemployed, underemployed and economically inactive

Question 2

What is the Claimant Count

Answer 2

The amount of people in the U.K on benefits

Question 3

How is the Claimant Count conducted

Answer 3

Measures the number of claimants on a particular day each month joining and leaving the count

Amount of people on JSA

Question 4

Drawbacks to the Claimant Count

Answer 4

Only an estimate

Question 5

How is the LFS conducted

Answer 5

Conducted quarterly

Question 6

Drawbacks to the LFS

Answer 6

Only an estimate
Conducted quarterly - doesn’t cover everything in the labour market
Sample - not fully representative

Question 7

Advantages to the LFS

Answer 7

Allowed to make comparisons with other countries

Can make historical comparisons - Barely changed how it’s been conducted

Question 8

Define Employed

Answer 8

Working more than one paid hour a day for a week or more than 15 unpaid hours in the family business

Question 9

Define Unemployed

Answer 9

Actively looking for work in the past 4 weeks and are willing and able to work within 2 weeks

Question 10

Define Underemployed

Answer 10

People who are working a job that doesn’t utilise their skill set to its full potential

Question 11

How does migration affect employment

Answer 11

Helps firm boost employment rate

Immigrants could take U.K citizens job - boosting unemployment

Employment increases without an increase in unemployment

Supply of labour is increased - reduces wage rate and equilibrium price of labour

Affects low skilled UK workers

Question 12

What is the Unemployment Effect

Answer 12

Consumers - Less to Spend - Less Choice + Lower Prices
Firms - Less Productive - Leads to a Fall in Profit
Lower Wages - Less Available Candidates to Employ
Government - Lower Income + Higher Expenditure - Budget Defecit

Question 13

What is Structural Unemployment

Answer 13

When industry in an area shuts down

Question 14

Describe Structural Unemployment

Answer 14

Demand for Labour < Supply for Labour

Lack of geographical + occupational mobility means people will be unemployed and need to be retrained

Question 15

What does it mean to be Inactive of Working Use

Answer 15

Seeking Employment but unable to start work or Not seeking employment

Question 16

What is Frictional Unemployment

Answer 16

People who are in the process of changing jobs

Question 17

What is Seasonal Unemployment

Answer 17

Unemployment at certain times of the year

Question 18

What does it mean to be Economically Active

Answer 18

Factors in the Employed and Unemployed

People who are engaged in the labour market and people employers can look to recruit

Question 19

What is the Employment Rate

Answer 19

Percentage of the population of working age who are employed

Question 20

What is the Unemployment Rate

Answer 20

Percentage of the economically active who are unemployed

Question 21

What is the Activity/Participation Rate

Answer 21

Percentage of population of working age who are economically active

Question 22

What is the Inactivity Rate

Answer 22

Percentage of the population of working age who are inactive

Question 23

Types of Unemployment

Answer 23

Friction Unemployment

Seasonal Unemployment

Structural Unemployment

Cyclical Unemployment

Real Wage Unemployment

Question 24

What is Real Wage Unemployment

Answer 24

When real wage rates are stuck at a level above that needed to reduce unemployment any further

Question 25

What is cyclical unemployment caused by

Answer 25

Lack of demand in the economy

Question 26

What is frictional unemployment caused by

Answer 26

Supply side factors

Question 27

What is seasonal unemployment caused by

Answer 27

Supply side factors

Question 28

What is structural unemployment caused by

Answer 28

Supply side factors

Question 29

What is real wage unemployment caused by

Answer 29

Supply side factors