Unemployment

• Employed definition

  Those of working age (15-67) who are both willing and able to work, and are currently engaged in more than 1 hour of paid work or working 15 or more unpaid hours in a family business per week.
• Unemployed definition

  Those of working age who are both willing and able to work but cannot find a job.
• Labour Force definition

  The labour force is anyone 15 years or older, who are willing and able to work (consists of both unemployed and employed)
• types of unemployment

  • cyclical
  • frictional
  • structural
  • seasonal
• Cyclical unemployment para

  S: Cyclical unemployment is associated with the downturn or trough phase of the business cycle, and is always involuntary.

  E: When the economy is slowing, demand for goods and services decline due to the lack of expenditure/consumption, and businesses need to cut production costs as profit falls - this includes employees.

  E: During covid, many people lost their jobs, particularly in businesses such as service and travel industries because of lockdowns, resulting in 36% of job losses in Air and Space Transport.
• Structural unemployment para

  S: Structural unemployment tends occur when the economy changes and one's job is no longer needed due to a change in demand.

  E: Industries and production methods change over time, leading to unemployment, often because the skills that one has are outdated or not transferrable to the new production methods. There is no direct solution, other than retraining or upskilling workers to adapt to the different demand in the economy.

  E: This can include outsourcing to other countries that have cheaper labour,
• Frictional unemployment para

  S: Frictional unemployment refers to people who have willingly left their job before finding another and tends to be shorter in duration.

  E: This is the only type of voluntary unemployment, and is usually higher in upswings or booms, as confidence levels are high, meaning that people feel more assured that they will be employed somewhere else in hope of finding a job that better suits their skills or with a higher pay.

  E:
• Seasonal Unemployment Para

  S: Seasonal unemployment occurs because the demand for certain goods and services, and as a result employees, change with the seasons.

  E: Throughout the year, the demand for particular goods and services will change according to the season. This is usually the shortest type of unemployment, as when the season returns, so does the job.

  E:
• Effects of unemployment on

  • individuals
  • communities
  • economy
• Effects on individuals

  • decreased income
  • Decreased expenditure of entertainment/leisure, and expensive items.
  • increased debt through loans
  • decreased savings
  • financial stress (impacts relationships)
  • increased crime
  • increased dependence on drugs and alcohol
  • Decreased standard of living (both material and non-material)