Unemployment

Definition

- For those individual who are working age, available for work at a certain wages but there are unemploy which do not have the current job.

- Unemployment rate can be calculate by the unemployment/labour force = % of unemployment rate.

Causes of Unemployment

3 causes

(i) Cyclical Unemployment

- it affect by the business cycle fluation.
- The Unemployment rises sharply whn the GDP falls and decrease when the real GDP growth rapidly.
- Cyclical Unemployment rises during the GDP falls or growth at a slower than normal rate and decrease whn the economy improves.

(ii) Frictional Unemployment

- occurs during natural working economy.
- For examples, move to other countries, people change job, seek for better opportunity and get lain for the current job.
- Improving the new information will effect informing workers of other opportunities in the economy and thereby will leads the employess to wuit the current job. Frictional Unemployment also known as search unemployment.

(iii) Structural Unemployment

- occurs because of the mistmatch between the job that are available and the skills of the workers.
- Workers whose skills do not match with the employment oppurtunity in their area may be unemployment.
- Re- skilling and other training and devlopment program may help to reduce the problem faced.

What is Natural-rate of Unemployment?

- Natural- rate of employment refers to the absence of the cyclical unemployment where it only consists of fractional unemployment and structural unemployment.

What are the causes of unemployment?

(i) economic waste
(ii) Severe hardship
(iii)Loss of goverment revenue