Employment & Unemployment

Question 1

Employment

Answer 1

State of having paid work and thus a form of income

Question 2

Unemployment

Answer 2

If you are able, available and willing to work but cannot find a job despite an active search for work

Question 3

Cyclical unemployment

Answer 3

Demand deficient- lack of demand and spending in economy

Question 4

Structural unemployment

Answer 4

Industries in decline and workers’ skills are becoming obsolete

Question 5

Frictional unemployment

Answer 5

Where people are between jobs

Question 6

Seasonal unemployment

Answer 6

Out of work depending on the season

Question 7

Classical/real wage inflexibility

Answer 7

When (the workers’) minimum wage is too high for them to be employed- problem with the supply side of labour

Question 8

Costs of unemployment (4)

Answer 8

1. No income
2. Skills obsolete & people lose confidence
3. People don’t spend as much in shops
4. More G- JSA and less tax revenue

Question 9

Measures of unemployment

Answer 9

LFS- questionnaire people 16-65 if they are unemployed
Claimant count- number of people claiming JSA
(LFS official measure by gov in UK)

Question 10

Underemployed

Answer 10

People are employed but their work is not giving them enough hours or not using their skills fully

Question 11

Benefits of increased employment (4)

Answer 11

1. Increased incomes- better living standards
2. Improved skills of worker
3. Multiplier effect
4. Higher tax revenue

Question 12

Benefits of lower unemployment (4)

Answer 12

1. Less spending on JSA
2. People out of job market for long time would be harder to employ
3. Job market more flexible- more workers to choose from
4. Decreased dependency ratios

Question 13

Negative and positive of immigration

Answer 13

Negative- if they do not find work then there is more unemployment
Positive- they fill gaps and employment increases and tax revenue does too