The Different Types of Unemployment - Assignment Example

Case Study Name Course Tutor Institution Date of Submission Question 1 Unemployment There are diverse definitions of the term unemployment. However, not all that befit to define unemployment in the context of economics. From a basic point of understanding. Unemployment refers to the situation where one is willing and able to perform a particular or a varied portfolio of tasks. However, he or she fails to secure an opportunity to work. Therefore, such an individual is expected to find work. Alternatively, unemployment is recognized as the situation when one is seeking for a job but does not find one (Beggs 2015). Other specific groups of people who belong to the class of the unemployed include those who have been temporarily laid off and are awaiting reassignment. The different types of unemployment There are some unemployment categories. They differ in terms of definition and context in which unemployment takes place. However, there are three major categories of unemployment. They include the structural, frictional and cyclical unemployment(Beggs 2015). The fourth subcategory incorporates the voluntary and involuntary unemployment. At times, people refuse to enroll into distinct categories of jobs on a voluntary basis. They are left to seek for new ones. Others do not get a chance to acquire opportunities that they can reject. The involuntary unemployment considers the status where one fails to get a form of job opportunity. Frictional unemployment The frictional unemployment is the form of unemployment that occurs as a result of normal turnover in the labor market. That is; it takes time for individuals to secure new jobs after they have freshly lost the ones they had prior(Beggs 2015). The form of unemployment may occur in the case where one leaves one job without fill consent of the next job for them. The case of voluntary unemployment features in the context where individuals remain unemployed in the context that they choose to remain until they get a job of choice. Therefore, this form of unemployment is not directly affiliated with economic forces that result in immense unemployment balance within an economy. Frictional unemployment may also occur when one is looking for a job for the first time after learning. Cyclical unemployment The cyclical unemployment is the form of unemployment that takes place when the economy is facing a recession, depression or poor rates of growth. The seasons are cyclical, therefore, the name cyclical unemployment(Beggs 2015). It is associated with the definite business cycles. High rates of unemployment occur during the recession period. The demand for products goes down. Concurrently, the economy falls and the resources to sustain employees reduced leading to scenarios such as laying off of workers. When these economic activities transpire, there are more workers available for employment in the economy and the jobs available are few. Therefore, the rate of unemployment reduce. However, during the boom economic sessions, cyclical form of unemployment disappears naturally. Therefore, this form of unemployment has a lot to do with the economic forces. Structural unemployment The structural unemployment features in two different forms. The first one is where the labor market possesses more laborers than the jobs available. For some reason, the condition is prevalent in the course that wages do not decrease to certify the market equilibrium(Beggs2015). Alternatively, the structural unemployment occurs in a context where the jobs are available but the available labor does not have the necessary skills required. Therefore, labors are available but cannot satisfy the demands of the job opportunities. Causes and effects of unemployment There are several causes of unemployment. First, unemployment is caused by degradation in the national, as well as, global economy level (Hoffmans 2011). The specific forces include the recession or depression of the economy. Further, inflation is also another major cause of unemployment as associated with the economy. Also, the rapid change in the technology is facilitating intensive retrenchment of employees since machines are replacing the human power. Unemployment also occurs due to changes in tastes for employment categories. There are scenarios where people choose some occupations over others(Hoffmans 2011). They remained unemployed on a voluntary basis. Alternatively, unemployment could result from adverse forces such as discrimination in places of work in the context of age, class and race amongst other forces. Unemployment could be as a result of one finishing studies. The initial moments are usually of being unemployment. Most importantly, the causes of unemployment fall under the categories of unemployment discussed. The effects of unemployment commence by poor living standards due to a decreasing unit domestic product. The effect is both economic and societal. Unemployment affects the economy in several ways(Hoffmans 2011). First, the spending power of households is affected negatively. The extent of money hoarding is greater than that of spending reducing a healthy supply of money in the economy, according to the monetary policy. Alternatively, unemployment results in some anomalous economic situations such as crime and violence. Others feel devastated and intend to elaborate their desperation through committing suicide whereas others increase the number of social outings. Question 2 The stipulated 5.6 percent average jobless rate is a statistic that is rated to have featured in the world of unemployment in Australia for quite a long time. Further, it is argued that the rate has remained resilient and constant for approximately 22 years in Australia (Cook 2015). From an analytical point of view, the rate has been prevalent for approximately two decades. Arguably, there must have been slight changes in the individual rates of unemployment of the teenagers and the rest of the population respectively. Arguably, the rate must have taken a natural stance holding all other factors constant. It is reasonable to insinuate that the rate of 5.6 percent is a natural one with regards to the Australian unemployment statistics. Latest official data shows that jobless rates dropped to 5.6 percent in September the same year after hitting a slightly high rate of 5.8 percent. The rate remains constant as approximately 9100 new jobs are created and the number of jobless people reduced by the same figure. However, the years are different from the aspect of the figures of employment. Accordingly, the year 2003 had the highest unemployment rate with regards to the numeric values. Over the given 22 years, the country has managed to sustain and recover the lowest rate of unemployment(Cook 2015). The government is a major facilitator of this economic success. Arguably, there are a number of factors that might have contributed to heightened unemployment rate and recovery rate. First, the economic stability is one factor that might have contributed to the continued recovery and increased the unemployment rate. The government plays a central role in this. For instance, there are government affiliated policies that may be playing a crucial role in determining the success of such a country in terms of unemployment rates. Policy that the government might have used to reduce the rate of unemployment The major policy that the government might have used in ensuring that it stabilizes the employment levels and recovery of the same is the public policy. From an economic point of understanding, the Australian government might have been in the front line to ensure that unemployment levels are reduced significantly to the natural 5.6 percent rates (Hermant 2014). Initially, the government seeks policies that will target the goal of reducing unemployment. Therefore, the public policy dimensions may have established programs that help the job seekers to match the skills with the demanded skills by employers (South Australia's Strategic Plan 2014). The approach is meant to deal with structural unemployment. The government may have facilitated the construction workshops used to train the people particular skill in in-depth measures. Some subsidiary public policies that the government may have facilitated includes the unemployment insurance(Cook 2015). The workers who have lost their lost jobs ought to have received a portion of what they were earning. However, the policy should ensure that it does not triumph towards facilitating laziness. The government may have set a minimum wage that employers must meet. That ensures that the skilled and semi-skilled have a share in the national cake of jobs. The axiom is stipulated in the Australian public policy. Question 3 Reason behind the proposition that teenage unemployment rate was and is larger than the average Research and reliable statistics gathered from the Australian Bureau of Statistics indicates that teenage jobless statistics stands at 19.3 percent. The rate is higher than 5.6 percent national average of the unemployed in the region. The rates given above are compared on professional aggregates to ascertain the fact that the rate of unemployed youths is now higher than the general population. To ascertain this statement, it is imperative to take a look at the rates some decades ago. For instance, in the year 1982, some 270, 000 young Australians who were aged between 15 and 24 years were unemployed (Australian Social Trends 1995). It is assumed that the same number of unemployed youths exists today. However, the number of these youths who are ready to participate in looking for work is smaller. From a research point of understanding, over the last 15 years, the youth unemployment rate has been much greater than the total unemployment rate. For instance, the rate of unemployment in 1994 was 17 percent as compared to 10 percent of the overall unemployment rate. These among other statistics are described in the graph below. Source:http://www.abs.gov.au/ausstats/abs@.nsf/2f762f95845417aeca25706c00834efa/6b96e708333ccab4ca2570ec00752766!OpenDocument From a statistical point of understanding, the comparison trends show that the reducing interest of the youths to participate in the employment seeking venture is resulting in the high unemployment rate amongst the youths today (2014/2015). Reasons for teenage unemployment in Australia A series of reasons for unemployment could be used to explain this scenario. However, it is important to note that the youths are either jobless due to the cyclical, structural or even frictional causes. Statistics in the year 1994 indicate that 24 percent of unemployed youth were job losers and 15 percent left their jobs. Accordingly, the main reason that the youths aged between 15 and 24 years are unemployed is varied. First, approximately 37 percent of them are fresh from learning and that they are looking for their first jobs (Jericho 2015). These people suffer involuntary unemployment. Further, approximately 15 percent of the people lose their recent posts or jobs. However, the largest number of youths are laid off or retrenched from their places of work. The inquiry of the reason behind the rapid collapse of the youth in the labor market resulted from a suggested low teenage unemployment rate in 3.7 percent in 1971. However, the proposition did not hinder the proportion of the unemployed youths from being high. For example, the Melbourne study of 239 16 and 17-year-old youths had been out of work for approximately a year. It took the proportion of 18 percent(Jericho 2015). An additional 8 percent had been out of work for approximately one year. Therefore, the issue of unemployment was likely and is likely to shift from the frictional form of unemployment to the psychologically-affiliated unemployment. The kinds of jobs that these youths get first are not enough to survive and sustain their accommodation demands. It is absolute that the trend is increasing. The rate of participation of the youth is wanting. Percentage-wise, fewer youths are in the job market. The Mission Australia Chief Executive Catherine implies the fact that unemployment rates range from 20 percent done not imply that the problem is underestimated. It is a clear sign that most young people are not interested is hustling for opportunities that do not exist in the economy. Question 4 It is assumed that if the employment scales keep growing strong, Australia faces a skilled workers shortage as they are all absorbed in the job market. Accordingly, there would be a further two interest rate rise prior to the mid-2004. It is imperative to elaborate the scenario from the January 2004 and September 2014 scenario of employment (South Australia's Strategic Plan 2014). Statistically, South Australian rate or unemployment registered a 0.6 difference with the national unemployment rate. The youth unemployment rate was taking a lead. However, the gap had decreased by 0.3 in the year 2014. That does not imply that the South Australian unemployment was way higher than the national. There were stages where the reverse was absolute. That is; the Australians were recording a lower unemployment rate in within the period. For instance, there was a scenario between August 2005 and February 2006 (South Australia's Strategic Plan 2014). There was also another one between May 2009 and February 2010. That is what it ought to be for unemployment. The interest rates have to equate or be quite lower than the average rates. The case where full employment of skilled personnel takes place means that the supply of more employees for specified positions in the economy is under threat. Therefore, the first impression of the threat is the increase of the interest rate by two. Arguably, the interest rate is likely to rise because there is an excess demand for skilled labor whereas the supply is not sufficient. Therefore, the extended form of unemployment, in this case, is the structural form of unemployment (Bell & Quiggin 2005). People fail to get employed because they do not match the skills required. The skilled persons expected to fill the positions are not available. The economy may have managed to absorb employees efficiently. However, the fatal problem is that there is an unhealthy balance in the labor market. Question 5 The heading “Go and get a job” looks like a wake-up call for a certain group of people that has completely refused to go and seek for employment opportunities. The Treasurer Peter Costello first considers the fact that the Australian jobless rate has been constant at 5.6 percent for 22 years at best (Hermant 2014). That statistical inference has a lot then it seems. I believe that Peter has an idea that he intends to share. For the two decades that the rate of unemployment has been steady at 5.6 means that it is a natural rate that cannot be disputed. However, there must be affirmative forces that are transpiring at the dormant rate of unemployment that is not that adverse for an economy. Arguably, Peter mentioned the statement insinuating that the youths should out of the perception that there are no jobs. Instead, the treasurer assumes that it is better that they try than remain in the current mood or dormancy. Accordingly, I agree with his comment. The initial problem of unemployment was economically affiliated. Economic forces caused the rate of unemployment amongst the youths. However, the recent trends of unemployment are out of little interest portrayed by the youths in searching for job opportunities(Hermant 2014). Therefore, the current problem of unemployment is not entirely resultant from the real facts. Assumptions are on course. Therefore, it is important that people should go and seek employment. There are a series of provisions as elaborated in the concept of the 1985 Bureau of the Labor market research report. It was assumed that the loss of part-time employment was as a result of creating permanent employment opportunities. Therefore, job opportunities are available especially in the context where unemployment maintains an equal or lower interest than the average. Bibliography Beggs, J. 2015, Types of Unemployment. Retrieved from http://economics.about.com/od/unemployment-category/a/Types-Of-Unemployment.htm Cook, T. 2015, February 12, Unemployment in Australia at 12-year high - World Socialist Web Site. Retrieved from https://www.wsws.org/en/articles/2015/02/21/jobs-f21.html Hermant, N. 2014, September 11, Youth unemployment: As bad as it is now, Australia has seen worse - ABC News (Australian Broadcasting Corporation). Retrieved from http://www.abc.net.au/news/2014-09-11/australia-continues-to-struggle-with-youth-unemployment/5738060 Hoffmans, L. 2011, Reasons Unemployment Is Still High - Forbes. Retrieved from http://www.forbes.com/sites/larahoffmans/2011/11/17/fisher-investments-5-unemployment-reasons/ Jericho, G. 2015, February 15, Young Australians are not giving up on work, despite high unemployment | Business | The Guardian. Retrieved from http://www.theguardian.com/business/grogonomics/2015/feb/17/young-people-are-by-not-giving-up-on-work-despite-high-unemployment 4102.0 - Australian Social Trends, 1995. 1995, June 20,. Retrieved from http://www.abs.gov.au/ausstats/abs@.nsf/2f762f95845417aeca25706c00834efa/6b96e708333ccab4ca2570ec00752766!OpenDocument South Australia's Strategic Plan. 2014, Retrieved from http://saplan.org.au/targets/49-unemployment Marks, G. N., & Fleming, N. 1998, Factors Influencing Youth Unemployment in Australia: 1980-1994. Longitudinal Surveys of Australian Youth. Research Report. ACER Customer Service, Private Bag 55, Camberwell, Victoria 3124 Australia (Code: A107LSA; $22 Australian).Council, M. W. R. (2001). Youth Strategy. Mid-Western Regional Council. Bell, S., & Quiggin, J. C. 2005, Unemployment, labour market insecurity and policy options, Australian Public Policy Program Working Paper PO5-2, Risk and Sustainable Management Group. Read More