Measuring economic performance - Measuring unemployment

Question 1

What is unemployment?

Answer 1

The level of unemployment is the number of people who are looking for a job but cannot find one

Question 2

What is the rate of unemployment?

Answer 2

The number of people out of work as a % of the labour force

Question 3

What is the labour force?

Answer 3

The number of people who are of working age and are able and willing to work

Question 4

What are the two ways of measuring unemployment?

Answer 4

• The claimant count
• The labour force Survey

Question 5

Explain the claimant count

Answer 5

The claimant count of the number of people claiming unemployment related benefits from the government.

Question 6

What are the advantages/disadvantages of the claimant count?

Answer 6

Advantages:
- The data is easy to obtain, you count the number of people claiming the unemployment related benefits
- There is no cost of collecting the data as it’s recorded when people apply for the benefits

Disadvantages:
- It can be manipulated by the government to make it seem smaller, e.g a change in the rules (e.g raising the school leaving age to 19) could reduce the number of people who could claim benefits, which would make it seem that unemployment was falling
- Excludes those who are looking for work but are not eligible to (or choose to not) claim any benefits

Question 7

Explain the Labour Force Survey