Unemployment

Question 1

Economically active

Answer 1

If he or she is participating in the labour market by either working or actively seeking work at going work rates

Question 2

Economically inactive

Answer 2

Are neither in work nor seeking it

Question 3

The population of working age

Answer 3

Consists of those between the ages of 16 and 65

Question 4

Participation ratio

Answer 4

it is usually calculated as the % of the population of working age that is economically active
Labour supply/ population of working age x 100

Question 5

Male participation ratios have fallen from 1971 to 2023

Answer 5

From 95% to 84%

Question 6

The elasticity of labour supply

Answer 6

The nature of the skill required in the job
Vocation
Tge length of the training
Time span under consideration

Question 7

The elasticity of demand for labour

Answer 7

The ease of substitution of capital for labour
The time span under consideration
Tge proportion of labour to total cost

Question 8

Govt intervention

Answer 8

National minimal wage £12.21
Four weeks paid annual leave
Paid maternity extended to 26 weeks
The right to reasonable time off in family emergencies
Three months paternity leave

Question 9

Unemployment rate

Answer 9

4.4%

Question 10

The missing millions

Answer 10

5.2 million people are on benefits but not working
9 million people are not working and not looking for work
The numbers are getting progressively worse

Question 11

Why is missing millions an issue

Answer 11

Firstly, its normal to work, earning money is how people sustain themselves and their families. Paying a tax is the main way we contribute to a society. A society in which a lot of people are out of work is unhealthy.
Secondly, tge economy is desperate for workers at the moment. Vacancies are at record levels: the labour shortages is driving inflation and business leaders are begging tge govt to loosen immigration rules
Two factors lead economies to grow: productivity and expanding workforce

Question 12

Problems

Answer 12

Lengthy nhs waiting lists, inadequate support of those health conditions
The lack of affordable childcare and support fir elderly relatives
Intransigence from employers refusing to offer flexible work

Question 13

Explain possible advantages and disadvantages of low rates of unemployment for the UK economy

Answer 13

Advantages:
• improves the public finances as the government pays lower benefits/ receives higher tax revenue (1)
• greater consumer spending as individuals in employment earn higher incomes (1)
• higher rates of economic growth/GDP due to higher output (1)
• higher living standards due to higher incomes (1)
• may result in lower rates of poverty and therefore lower socioeconomic deprivation in society (1)
Disadvantages:
• labour shortages will put upward pressure on wages (1). During periods of low unemployment firms can struggle to fill vacancies in unpopular jobs (1)
• higher inflation may be caused by rising wages (1)
lon’t have skill sets required (1)
• the labour market could reach a point where each additional job added does not create enough productivity to cover its wage cost, making every successive job after that point inefficient (1)