Labour Markets Flashcards
What is the labour market?
Where firms and workers meet to trade
What is monetizing?
Turning something into money
e.g monetizing workers skills
Problems with unemployment
- Loss of income and utility
- Loss of human capital skills (confidence, skills)
What does Human capital refer to?
Knowledge and skills of workers that have economic value
e.g Productivity
Unemployment scarring
Negative impact on ones furture employment
( the best preidctor of furture employment is past employment)
Wage scarring
negative impact on ones furture earning potential caused by period of unemployment
Solution for regional employment
Economy - wide policies
Provide support
Create opportunities
What is the labour force survey and what are the groups of labour?
Detailed pic of the UK labour market at national and regional level
- Survey of UK households by ONS
1. Working age population (16-64) - Workforce and economically inactive
2. Below 16 yrs or in institutional care
What does economically active mean
Either un/employed
Must be able to work in 2 weeks and
- Without work but made efforts in last 4 weeks
- waiting to be called back from job since laid off
- Waiting to start new job in 30 days
How to work out Unemployment rate
100 x no of unemployed/work force
How to work out employment rate
100 x no. employed/ Working age population
How to work out economic activity rate
- % of workng age population economically active
100 x Workforce/ working age pop
What are the types of unemployment?
Frictional
Structural
Cyclincal
Natural
What is Frictional unemployment?
Between jobs/ searching for a new
(e.g Uni student after graduating)
What is Structural unemployment?
Skills mismatch or changes in market causing skills change needed to perform job or location
(e.g coal industry - Margret Thatcher)
What is Cyclincal unemployment?
Linked to stages of the business cycle, when economy improves this decreases
What is natural unemployment?
Increases when cyclincal unemployment is 0
