Employment/Unemployment

Question 1

What is employment

Answer 1

Working 1 or more hours per week and being paid for it

Question 2

What is unemployment (to the ABS)

Answer 2

a person who does not have a paid job who is actively looking for work (completing job applications, registered with Centrelink) in the week prior to the survey.

Question 3

Who measures the unemployment rates

Answer 3

The Australian Burea of Statistics (ABS) - measures in monthly with 0.5 percent of our population

Question 4

What are the limits of the ABS unemployment rate calculation

Answer 4

Small sample size, hidden unemployment, underemployment, and misleading survey answers

Question 5

Small sample size (limits of the ABS unemployment rate calculation)

Answer 5

Only 0.5 percent of the population participate in this survey monthly so the sample size is not big enough to get a true indication of the unemployment rate

Question 6

Misleading survey answers (limits of the ABS unemployment rate calculation)

Answer 6

when responding to a survey about employment, it is possible that some people provide misleading responses in fear of losing benefits if they respond by saying they have completed some work during the period or if found out they were not looking for a job. This may therefore exaggerate the unemployment figures

Question 7

What is hidden unemployment

Answer 7

Discouraged job seekers (people not actively looking for work as they have become discouraged - maybe because they have been looking for a long time and can’t find anything) are not classified in the labour force. Therefore statistics underestimate the extent of unemployment

Question 8

What is underemployment,

Answer 8

those working below capacity eg part time workers who what to be full time. Therefore statistics underestimate the extent of unemployment

Question 9

What is the labour force

Answer 9

People aged over 15 who are either Employed or Unemployed

Question 10

Who is apart of the Non Labour force

Answer 10

People aged over 15 who are not actively looking for a job, for example retired people, some disabled people, etc.

Question 11

Diagram of labour force and non labour force

Answer 11

People aged over 15 years old

Labour Force Non-Labour Force

Employed
Unemployed

Question 12

How to Calculate the unemployment rate

Answer 12

Number of people unemployed x 100
Number of people in the labour force x 1

Question 13

What is the unemployment rate

Answer 13

Roughly 4%

Question 14

What is the youth unemployment rate

Answer 14

Roughly 8% (double the normal unemployment rate)

Question 15

Name the 4 types of unemployment

Answer 15

Cyclical, Structural, Seasonal, Frictional

Question 16

Cyclical unemployment

Answer 16

When the level of spending in the economy falls. When consumers or businesses feel like the economy is gonna fall they tend to save rather than spend. This leads to
reduced spending, reduced production and hence a
reduced need for labour. If this persists the economy can move into a period of negative growth. Two consecutive quarters of negative economic growth is referred to as a recession

Question 17

Structural unemployment

Answer 17

Structural unemployment occurs as a result of changes in the way goods and services are produced. This takes place when production methods change in order to increase productivity,

Another cause of structural unemployment is outsourcing. This is when one section or department of a business is closed and its work is done overs

Question 18

Seasonal unemployment

Answer 18

Seasonal unemployment results from the termination of jobs at the same time each year due to the regular change in seasons. (snow melts) (fruit goes unripe)

Question 19

Frictional unemployment

Answer 19

Frictional unemployment occurs when people are unemployed between finishing one job and starting another

Question 20

Examples of each unemployment

Answer 20

Frictional: For actors, in between movies when they don’t have a job

Seasonal: Working in ski fields, fruit picking, etc

Structural: Robots replacing humans, car manufacturing

Cyclical: Not many people needed to buy cars anymore - the manufactures would stop producing as many which results in less labour being needed - people get fired.

Question 21

Long term unemployment

Answer 21

those have been unemployed for over 52 weeks (1 year)

Question 22

Youth Unemployment

Answer 22

Those aged 15-24 who are unemployed

Question 23

Impact unemployment has (individuals, society and government)

Answer 23

Individuals: Reduced income, Family unhappiness, Lower self image, Less healthy.

Society: Increase in crime and vandalism, Non-material living standards fall, fewer goods and services are produced,

Government: Less revenue collected from income tax, more unemployment benefits are paid, (earning less money but paying more)