Unemployment pt2

Question 1

Why does the government care who works?

Answer 1

Less people earning disposable income
Unused labour, less output
Pay more in benefits
Less tax revenue

Question 2

Labour and demand

Answer 2

Labour is derived from demand. Employers need for labour (demand from labour) is derived from (and dependent on) the consumers demand for goods and services. If consumer demand is low (low growth), unemployment will rise and vice versa

Question 3

Types of unemployment

Answer 3

Structural
Frictional
Cyclical
Seasonal

Question 4

Voluntary unemployment

Answer 4

At a given wage rate, do not wish to accept job

Question 5

Involuntary unemployment

Answer 5

Prepared to work at going wage rate but unable to find work

Question 6

Structural employment

Answer 6

Caused by a decline in a certain industry or occupation . Usually due to technology advances or changes in consumer preferences. Made worse by labour immobility

Question 7

Types of Labour immobility

Answer 7

Occupational or geographical immobility

Question 8

Occupational immobility

Answer 8

Some occupations decline over time but the workers don’t have the skills required to do the jobs that are available

Question 9

Geographical immobility

Answer 9

Workers aren’t able to leave a region with high unemployment to go to another region where they have jobs. Possibly because they can’t afford to leave or may have family ties.