Employment & unemployment Flashcards
Measures of unemployment
- Claimant count: based on No. of people claiming unemployment-related benefits (Jobseeker’s Allowance). provides a narrow definition of unemployment, as it only includes those actively seeking & receiving government benefits.
- LFS: Uses ILO definition & is the primary source of unemployment data in the UK
Under-Employment
Occurs when individuals are employed but their job does not fully utilize their skills and qualifications. This can result in part-time work, low wages, or jobs below their skill level.
- overeducation is one possible source of underemployment.
Employment, unemployment, and inactivity rate
- Employment rate: Measures the proportion of the working-age population in employment
- Unemployment rate: Measures the proportion of the labour force actively seeking work
- Inactivity rate: Measures the proportion of the working-age population that is not in the labour force. It can indicate a lack of job opportunities or demographic factors
Causes of unemployment
- Structural unemployment
- Frictional unemployment
- Seasonal unemployment
- Cyclical unemployment
- Real wage inflexibility
Structural unemployment
- a form of involuntary unemployment caused by a mismatch between the skills that workers in the economy can offer, and the skills demanded of workers by employers
- Result of various factors causing long-term job loss across industries.
- reflects a shifting pattern of demand for different kinds of labour
From an individual perspective, structural unemployment can be due to:
- Inability to afford or decision not to pursue further education or job training.
- Choice of a field of study which did not produce marketable job skills.
- Inability to afford relocation.
- Inability to relocate due to inability to sell a house (for example due to the collapse of a real estate bubble or of the local economy).
- Decision not to relocate, in order to stay with a spouse, family, friends, etc.
From a larger perspective, there can be a number of reasons for structural unemployment across large numbers of workers:
- Technological obsolescence: Digitization leading to the disappearance of certain expertise (e.g., manual typesetters).
- Productivity increases: Reduced workforce needs due to efficiency improvements.
- Shifts in technology: Automation requiring fewer, but higher-skilled workers.
- Competition and globalization: Job relocations to lower-cost regions or countries.
- Political changes: Impacting industries and employment patterns (e.g., collapse of the Soviet Union).
- Economic shifts: Challenges when large companies close, leaving workers with limited options.
Discrimination and structural unemployment with example
- Employers may also reject workers for reasons unrelated to skills or geography, so for example structural unemployment can also result from discrimination, including ableism and cultural factors such as race or sexual orientation.
- TUC analysis found that the BME (Black, minority and ethnic) unemployment rate stood at 6.9% in 2022, compared to 3.2% for white workers.
- Race to Equality report in 2021 found that Two in three UK finance workers from black and minority ethnic backgrounds have suffered discrimination in the workplace
Middle skills jobs and structural unemployment
- happens within industries as technology changes the nature of work within a given field.This is a driver of skills gaps as technology and globalization “hollow out” many middle-skill jobs, positions that traditionally have not required a college degree.
- A 2017 report by the OECD found that between 1995 and 2015, the middle-skill share of employment fell by 9.5 percentage points in the OECD area. the share of workers in middle-skill jobs fell from 49% in 1995 to under 40% in 2015.
- About 80% of those lost middle-skill jobs have been replaced by high-skill jobs (good for young people attending Uni, bad for middle-aged workers who do not upskill)
March 2023 Goldman Sachs report
- AIcould replace the equivalent of 300 million full-time jobs
- The bank’s analysis of jobs in the U.S. & Europe shows that two-thirds of jobs could be automated at least to some degree.
- In the U.S., office and administrative support jobs have the highest proportion of tasks that could be automated with 46%
- On the other end of the scale, just 1% of tasks in the building and ground cleanings and maintenance sector are vulnerable to automation
Labour, Geographical, and occupational immobility
- Labour Mobility refers to the ability of workers to change from one job to another
- Geographical immobility refers to the inability of labour to move from one area to another to find work
- Occupational immobility refers to the inability of labour to move from one type of job to another
- Occupational and geographic exacerbate structural unemployment. They do not cause it!
Government Strategies to increase Geographical Mobility
- Relaxation of building laws: this increases the availability of houses, and also lowers prices.
- Increasing construction of social housing: Council flats tend to be more affordable for migrants.
- Housing subsidies: the Gov offers subsidies to Key Workers. These subsidies include mortgage relief and relocation grants.
Structural unemployment example of possible Relaxation of building laws
- the Town and Country Planning Act 1947 and successors
- ASI says The TCPA nationalised land more than it did anything else
WHAT IS A SECTION 106 AGREEMENT?
A section 106 agreement is an agreement between a developer and a local planning authority about measures that the developer must take to reduce their impact on the community. A section 106 agreement is designed to make a development possible that would otherwise not be possible, by obtaining concessions and contributions from the developer. It forms a section of the Town And Country Planning Act 1990.
What are planning obligations?
Planning obligations are legal obligations entered into to mitigate the impacts of a development proposal.
This can be via a planning agreement entered into under section 106 of the Town and Country Planning Act 1990 by a person with an interest in the land and the local planning authority; or via a unilateral undertaking entered into by a person with an interest in the land without the local planning authority.
Planning obligations run with the land, are legally binding and enforceable. A unilateral undertaking cannot bind the local planning authority because they are not party to it.
Planning obligations are also commonly referred to as ‘section 106’, ‘s106’, as well as ‘developer contributions’ when considered alongside highways contributions and the Community Infrastructure Levy.
Average regional house prices in England 2023
- London: £527,909
- South East: £389,759
- North East: 159,741
Housing affordability in England and Wales: 2022
In 2022, full-time employees in England could expect to spend around 8.3 times their annual earnings buying a home.
- Over the last 25 years, housing affordability has worsened in every Local Authority, especially in London or surrounding areas.
- The most affordable area in London was less affordable than the least affordable area in the North East.
Labour Party commissioned report: Land For The Many
- “The question of who gains the benefit from rising land values, and how this is used, has sat at the centre of land debates for centuries.”
- reccomended introducing a land value tax
Land Value Tax (LVT)
- A method of assessing property taxes that only considers the value of the land itself and related improvements, and not the structures built on the land.
- Considered to be a more fair method of land taxation for agricultural regions where the land is productive
- Changes in property values are largely determined by market swings and can be extremely volatile. LVT helps mitigate these market swings by separating the more stable value of the land from the buildings
- An example of an ad valorem tax.
WEhat does martin Woilf say about Land value Tax
WEhat does martin Woilf say about Land value Tax
- Incorporating land into produced capital led to the neoclassical “two factor” models of the economy, which are grossly misleading. As a result, taxes on land were increasingly considered in the context of taxes on wealth, even though natural resources are quite different from the capital stock created out of effort and foregone consumption.
- The moral case for separating the return on natural resources from that on other assets is that the former pre-exist human efforts
- tax unearned rent far more and capital formation and people’s work far less.
Levelling Up Fund
- launched in 2020
- designed to “create new jobs, drive economic growth, help restore people’s pride in the places where they live, and spread opportunity more equally”
- £4.8 billion
- So far two rounds of funding
- Round 2: More than 100 projects awarded share of £2.1 billion.
More than £645 million has been allocated to 26 projects across the United Kingdom to improve transport links.
Criticisms of the Levelling up funding process
- The centralised system of London civil servants distributes the funds rather than local policy makers who may be better positioned to understand which areas most need it
- Contributes to “begging bowl culture” - mayor for the West Midlands Andy Street
- Conservative-held constituencies in Parliament were the biggest winners
- the money awarded was dwarfed by the cuts to local authority funding since 2010
In March 2024 The Public Accounts Committee (PAC) said barely any of the 71 “shovel-ready” projects due to be completed in that month were on track.
- The chair of the comittee said that Department for Levelling Up, Housing and Communities appeared to have been “blinded by optimism” in funding projects that were “clearly anything but ‘shovel-ready’, at the expense of projects that could have made a real difference”.
What is the government looking at apart from The Levelling Up Fund
- Having 22,000 civil servants based outside London by the end of the decade
- The Gov wants to level up skills with an extra £126m announced in March 2021 to fund work placements and training for 16 to 24-year-olds in England
- Eight freeports have been set up in England, with two planned in Scotland and one more in Wales.
English council house waiting lists
- There were 1.21 million households on local authority waiting lists on 31 March 2022, an increase of 2% from 1.19 million in 2020/21
- 21,600 social homes were either sold or demolished in 2021/22, while only 7,500 new homes were built leading to a net loss of 14,100homes
Applications for social housing in England determined by local councils
London social housing waiting list
- Highest among English regions
- 323,827 households on local authority waiting lists in London in 2023.
- The capital has 60,580 homeless households, which include more than 80,000 children
- Rise of about 70% in No. of households in temporary accommodation since 2010
- London boroughs spent £450m on homelessness in 2023-24
Requirements for being an applicant to Reigate and Banstead Housing register
- Have lived in the borough of Reigate & Banstead continuously for at least the last three years, or worked here continuously for at least the last 12 months
- Have gross annual household income under:
£30,000 (single applicants)
£35,000 (joint applicants - two adults only in household)
£50,000 (all other households) - Not have savings/capital/assets over £16,000
- Not own their own home (this includes shared ownership)
- Not have rent or Council Tax arrears
- Not have a record of unacceptable behaviour/ASB
- Have a ‘housing need’ as defined in the Housing Register and Allocations Policy (waiting list applicants only)
- Be eligible for an allocation of social housing according to their immigration status
The application is in two parts and will take approximately one hour to complete
Steps to get social housing in Reigate & Banstead
- join the Housing Register
- Use the HomeChoice website to view and bid for (i.e. express an interest in) available properties
- Every week any available properties will be advertised on HomeChoice. Applicants can bid on up to three properties.Only those who have bid on a property can be nominated to it.
- Once bidding has closed for the week, shortlists are created. The homes will be offered to the applicants who have waited the longest
Bidding process is callled a choice based lettings system
These are properties owned and managed by various housing associations. Reigate & Banstead Borough Council does not own any housing stock
