2.1.3 Unemployment Flashcards Preview

AS Macro Economics > 2.1.3 Unemployment > Flashcards

Flashcards in 2.1.3 Unemployment Deck (31)
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1
Q

What is meant by ‘unemployment’?

A

those who are willing and able to work and are currently seeking work, but cant find anything at this given moment

2
Q

What is the Claimant Count?

A

the amount of people claiming JSA

3
Q

Give a reason why this may not be accurate

A

some may be ashamed to claim JSA so it does not show the whole unemployed population

4
Q

What is the ILO measure of unemployment?

A

Labour force survey is the survey of 60,000 households analysing their employment status

5
Q

Give a reason why this might not be accurate

A

it is under representative as it only represents part of the population

6
Q

Which of the two measures is typically higher and why?

A

ILO, because by law you must complete it

7
Q

What is meant by ‘underemployment’

A

when people are working in jobs where they would be over qualified

8
Q

Why did this become more relevant post-Financial Crisis?

A

Many industries were shut down

9
Q

What is meant by ‘employment’?

A

those in paid jobs right now

10
Q

What is meant by ‘economically inactive’?

A

those willing and able to work but have been withdrawn from the work force due to circumstances

11
Q

What is the difference between the population of a country and its labour force?

A

the population is everyone residing in the country

the labour force is everyone in the work force

12
Q

Why do we find that Employment and Unemployment sometimes rise at the same time?

A

Old people leave the workforce

Young people join the workforce

13
Q

What are the current retirement ages in the UK?

A

65 - 67

14
Q

What is a ‘discouraged’ worker?

A

able to work but not actively seeking work

15
Q

What is ‘structural unemployment’?

A

the industrial reorganisation due to technological changes

16
Q

What is ‘frictional unemployment’?

A

when people jump from one job to another

17
Q

What is ‘seasonal unemployment’?

A

when the industry doesn’t need workers all year round

18
Q

What is ‘demand deficient-’ or ‘cyclical unemployment’?

A

when there’s a lack of demand, usually during times of economic decline or recession

19
Q

What is ‘real wage inflexibility’?

A

when the real wage rate is above the equilibrium wage rate

20
Q

Which of these types of unemployment is most likely to result in long term unemployment?

A

structural unemployment

21
Q

How would a lack of skills in an economy effect the unemployment rate?

A

unemployment would go up

22
Q

What is meant by ‘net inward migration’?

A

the difference between emigration and immigration

23
Q

What is the likely effect of ‘net inward migration’ on employment rates?

A

employment rates go up

24
Q

What is the likely effect of ‘net inward migration’ on unemployment rates?

A

unemployment goes down

25
Q

How does unemployment affect the individual and his/her family?

A

poverty increases, disposable income goes down, MPS increases

26
Q

How does unemployment affect consumers?

A

MPC does down

27
Q

How does unemployment affect firms?

A

reduced profitability as they will have to cut back costs

28
Q

How does unemployment affect those remaining in work?

A

employees may have loss of productivity and motivation

29
Q

How does unemployment affect government?

A

loss of incentive to invest

30
Q

How does unemployment affect society?

A

more poverty, more crime

31
Q

Why might we expect, or even desire, the unemployment rate of an economy to be above 0%?

A

to maintain stable inflation

for real wage inflexibility