{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Unemployment_is_the_phenomenon_that_is_observed_when_those_desirous_of

Unemployment_is_the_phenomenon_that_is_observed_when_those_desirous_of

Info icon This preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Abhishek Phadnis                           Essay on Inflation and  Unemployment Unemployment vs. Inflation Unemployment Unemployment is the phenomenon that is observed when those desirous of (and capable of) offering their services on the labour market fail to find gainful employment. Its antonym is full employment, which is the quantity of the labour force employed when the labour market is in equilibrium – in which case Aggregate Supply for Labour equals the Aggregate Demand for the same. Note that the Aggregate Supply of Labour is upward sloping, thanks to workers’ added incentive to work in the event of rising real wages, and that falling real wages would encourage companies to hire and approach full employment. It may be important to remember that the scenarios given below address the labour market as a whole, and not just the fluctuations of an individual market, which is why the full picture often appears only when all individual markets are viewed collectively (as there would be constant minor fluctuations in the individual markets). The Rate of Unemployment The rate of unemployment is thus defined as the number of unemployed as a percentage of the total labour force (which itself is defined as those over 16 who are either employed or desirous of gainful employment, a definition that notably excludes vast swathes of the population such as students, military personnel and the elderly. Several minor problems may arise when generating unemployment statistics, such as the definitional problems with defining certain unique sections of society like those approaching retirement age and the accounting problems arising from the discrepancies caused by the disparity between the real number of employed/unemployed and the official number. Eventually, those in training programmes and the informal economy may be ignored, but this is a considerable problem in generating all variety of economic statistics and ought not to be considered the preserve of unemployment statistics alone. Categories of Unemployment that Comprise the  NRU For definitional and comprehensibleness purposes, unemployment is divided into three major categories – structural unemployment (which is what arises from the disparity between the skills demanded by the economy and those supplied by the labour markets, 1
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Abhishek Phadnis                           Essay on Inflation and  Unemployment particularly in sunset industries such as the once-fabled car market of Detroit, USA, and redundancies caused by technological improvements), seasonal unemployment (the periodic loss unemployment in industries regularly accustomed to periods of market inertia, such as holiday/charter service workers and even professional cricketers on the English county circuit) and frictional unemployment (the interim period of transition from one job to another, depending on a host of other factors, largely recognized because unemployment is a stock concept). It may also help to note that there will almost perennially be a certain rate of
Image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern