Contents:
I. Definition of unemployment
II. Causes of unemployment
III. Types of unemployment
IV. Cost of unemployment
V. Measures to reduce unemployment
VI. Conclusion
VII. References.
Definition of unemployment:
Unemployment refers to the number of
people who are jobless in an economy; unemployment is measured in terms of
unemployment rate which is derived from the number of people who are unemployed
divided by the total labor force. Unemployment has been a concern to
governments as they apply policies that aid in reducing unemployment.
Unemployment means a condition in which
an economy has idle resources that are not being utilized, labor is a factor of
production and if a country does not utilize this labor to the fullest then we
have unemployment of labor which is a factor of production.
Unemployment however can be termed as a
state in which an individual is looking for a job but not getting one, however
unemployment does not include students, retired people or even children. There
are three types of unemployment namely cyclical unemployment, frictional and
structural unemployment, there are two types of frictional unemployment and
this includes seasonal unemployment and waits unemployment.
Measurement of unemployment:
Types of unemployment:
Cyclical unemployment:
This type of unemployment exist where we have
inadequate aggregate demand, its name is derived for varying business cycles,
business cycles refers to varying of aggregate demand which when aggregate
demand falls this discourages investments leading to unemployment, this
business cycles are brought about by high tax levels, under consumption, low
government spending and a decline in exports. Therefore this type of
unemployment will result due to low aggregate demand which will cause a decline
in investment leading to lower employment levels.
Frictional unemployment:
This type of unemployment results from people
who are between jobs or temporarily looking for new ones, this type of
unemployment is usually seen as voluntary unemployment because people search
for new jobs, however this type of unemployment allows workers to get the best
jobs that meet their wants and skills.
There are two types of frictional unemployment
and they include the wait unemployment and seasonal unemployment:
Wait unemployment:
This is one type of frictional unemployment
whereby workers will wait to achieve the few high paying jobs in an economy,
this results to what is termed as wait unemployment.
Seasonal unemployment:
This type of frictional unemployment is as a
result of seasonal occupations that results from seasons, some enterprises
provide jobs only during certain seasons and when the season is over they cause
unemployment which is termed as seasonal unemployment.
Structural unemployment
Structural Unemployment results from the
changes in the economy, this type of unemployment results from changes in the
economic structure of an economy making a mismatch between the job and the job
seekers a good example is the advancement in technology leading current workers
to be unemployed because they lack necessary skills for the job. The
introduction of modern technology such as computers will result to unemployment
of old employees who may be computer illiterate.
Disguised unemployment:
This is another type of unemployment whereby
it can be termed as under unemployment, it involves employment that does not
the equilibrium wage rate, example a person who spends the whole day herding
only one sheep yet he can manage to take care of a hundred goats; this is
termed as disguised unemployment.
Causes of unemployment:
Cyclical unemployment:
Cyclical unemployment is caused by business
cycles which result from reduced aggregate demand; the reduction in aggregate
demand will discourage investment leading to unemployment.
Frictional unemployment:
This type of unemployment is caused by people
who are in between jobs or are looking for better jobs. Seasonal unemployment
is caused by changes in seasons while wait unemployment is caused by the few
available high paying jobs.
Structural unemployment:
This type of unemployment is caused by changes
in the structural forms of an economy where by the current employees will lack
the necessary skills for job resulting to unemployment.
Disguised unemployment:
This type of unemployment is caused by
underemployment whereby the person is employed but under employed, it is caused
by lack of resources to produce and poverty.
Cost of unemployment:
Measures to reduce unemployment:
Cyclical unemployment:
According to the Keynesian theory this type of
unemployment can be solved through stimulation of aggregate demand whereby this
can be done through increased government spending or an expansionary monetary
policy.
Frictional unemployment:
This type of unemployment cannot be solved
through stimulation of aggregate demand as in the case of cyclical
unemployment; this type of unemployment can be solved through the provision of
more and better information to employers and the employees about a particular
job.
Structural unemployment:
This type of unemployment results from the
structural changes in the economy, this type of unemployment therefore can be
resolved through the retraining of workers for their present jobs.
Disguised unemployment:
This type of unemployment can be reduced
through government and monetary policies, because it results from poverty
strategy that help eradicate poverty will play a major role in reducing this
type of unemployment.
Conclusion:
Don’t hesitate to do anything that is rational
and up to your demands. ‘Every dog has a day’- means not stopping searching
would not last in exquisite but could lead you a settlement of ease. The
proverb suggests you to be nomadic/nerd like a dog. No job in this world is
worthless and of no value. This world is an ecosystem of all components in it.
A disparity/discrimination in any work means you are out of this world and
there is no place for you.
References: Purely Google search.