Unemployment

Question 1

define un employment

Answer 1

the percentage of the population that is willing and able to work but is not employed.

Question 2

The Labour Market - 2 categories

Answer 2

1. people who are employed - completed at least 1 hour of paid work in a week or worked unpaid for over 15 hours in a family business
2. people who are not in the labour force - ppl who aren’t looking for a job

Question 3

what is the participation rate

Answer 3

the employed & unemployed categories of ppl combined from the portion of the population that are in work or actively seeking work

Question 4

what is the participation rate in 2020 June Aus

Answer 4

64%

Question 5

what has been the highest and lowest participation rate in Aus since 1980

Answer 5

highest participation rate has been 65.8% and the lowest has been 60.2%

Question 6

What are the factors affecting participation rate

Answer 6

• the unemployment rate
• age structure
• gender equity
• employment conditions

Question 7

what is the target rate for unemployment

Answer 7

4-5%

Question 8

What are some Australian Unemployment Trends

Answer 8

• UE rates among middle aged ppl have increased a lot
• the avg duration of UE has risen from 12 weeks in 1980 to 18 weeks in 2013
• Youth UE is consistently higher than adult UE, approximately 3 times the adult rate

Question 9

define long term unemployed

Answer 9

• people that have been out of work for 12 months or longer

Question 10

define underemployment

Answer 10

• ppl who are employed but are working less hours than they would prefer. For example, part-time workers that would prefer to be working full-time (aka disguised unemployment)

Question 11

define hidden employment

Answer 11

people that cannot find work, become discouraged, and drop out of the labour force

Question 12

define voluntary unemployment

Answer 12

a worker that has decided to leave their job in search for another position

Question 13

define involuntary unemployment

Answer 13

a worker that has been laid off from their place of work (because of redundancy, restructuring, capital-for-labour substitution etc.)

Question 14

what are the 4 types of unemployment

Answer 14

1. Frictional UE
2. Cyclical UE
3. Structural UE
4. Seasonal UE

Question 15

what is frictional UE

Answer 15

• people that leave their jobs in search for another job
• responsible for small proportion of the UE
• duration is usually less than 4 weeks

Question 16

what is cyclical UE

Answer 16

• UE that follows the swings in the business cycle

- at the peak of the boom in econ activity, cyclical UE should be close to zero.

Question 17

what is structural UE

Answer 17

• Mismatch of available skills and required skills in a geographical or occupational sector of the economy.
• In other words, changes to how we produce goods and services make workers’ skills redundant
• Eg. bank tellers being replaced by ATMs

Question 18

causes of structural UE

Answer 18

• New technology
  -Changes in consumer demands
• Productivity increases reduce the number of workers required
• Competition – globalisation and free trade agreements
  Worker’s decision not to pursue further study / training

Question 19

how can structural UE be good for the economy?

Answer 19

• Can be good for the economy if the worker then retrains and up-skills in order to find a new job

Question 20

how can structural UE be bad for the economy?

Answer 20

• Can be bad for the economy if the worker does not retrain and their lack of useful skills turn into long-term unemployment

Question 21

what is seasonal UE

Answer 21

• Occurs when workers are unemployed at certain times of the year, because their job does not require work all year-round
• Eg. farmers, life guards, workers in tourism