Unemployment is an active job search situation but is not currently in use.
The unemployment rate is a measure of the prevalence of unemployment and is calculated as a percentage by dividing the number of individuals unemployed by all individuals currently in the workforce. During the recessionary period, the economy typically experiences relatively high unemployment rates. According to the report of the International Labor Organization, more than 200 million people worldwide or 6% of the world's workforce have no work in 2012.
The cause of unemployment is highly debated. The classical economy, the new classical economy, and the Austrian School of Economics argue that market mechanisms are a reliable means of resolving unemployment. These theories argue against interventions imposed on the external labor market, such as unions, bureaucratic work rules, minimum wage laws, taxes, and other regulations they claim to hinder the recruitment of workers. The Keynesian economy stresses the nature of the unemployment cycle and recommends government intervention in an economy that it claims will reduce unemployment during the recession. This theory focuses on recurrent shocks that suddenly reduce aggregate demand for goods and services and thereby reduce the demand for workers. Keynesian models recommend government interventions designed to increase labor demand; this may include financial stimuli, the creation of publicly funded employment, and expansionist monetary policy. Named economist John Maynard Keynes, believes that the root cause of unemployment is the desire of investors to receive more money than to produce more products, which is impossible without the public body making new money. The third group of theories emphasizes the need for a stable supply of capital and investment to maintain full employment. In this view, the government should ensure full employment through fiscal policy, monetary policy and trade policy as stated, for example, in the US Employment Act of 1946, by warding off the private sector or the volatility of trade investments, and reducing inequality.
In addition to these comprehensive unemployment theories, there are several categories of unemployment that are used to more precisely model the effects of unemployment in the economic system. The main types of unemployment include structural unemployment that focuses on the structural problems in the economy and inefficiencies inherent in the labor market, including the discrepancy between labor supply and demand with the necessary skill sets. Structural arguments emphasize the causes and solutions associated with disruptive technology and globalization.... Discussion of the focus of frictional unemployment on voluntary decisions to work based on individual assessment of their own work and how that compares with current wage levels plus time and the effort required to find work. The causes and solutions for frictional unemployment often overcome employment entry thresholds and wage rates. [[Behavioral economics | Behavioral economists]
Video Unemployment
Definitions, types, and theories
The state without work for the educated, to earn a living is with unemployment. Economists distinguish between different types and theories of overlapping unemployment, including cyclical or Keynesian unemployment, frictional unemployment, structural unemployment, and classical unemployment. Some of the additional types of unemployment that are sometimes mentioned are seasonal unemployment, hardcore unemployment, and hidden unemployment.
Although there are several definitions of "voluntary" and "unintentional unemployment" in the economic literature, simple differences are often applied. Voluntary unemployment is associated with individual decisions, whereas unemployment is not voluntary because of the socio-economic environment (including market structure, government intervention, and aggregate demand levels) in which individuals operate. In this term, many or most frictional unemployment are voluntary, as this reflects an individual's search behavior. Voluntary unemployment includes workers who refuse low-wage jobs while unemployed unemployed include workers fired due to economic crisis, industry downturn, corporate bankruptcy, or organizational restructuring.
On the other hand, cyclical unemployment, structural unemployment, and classical unemployment are largely unconscious. However, the existence of structural unemployment may reflect the choices made by the unemployed in the past, while classic (natural) unemployment can result from the legislative and economic choices made by unions or political parties. Thus, in practice, the difference between voluntary and involuntary unemployment is difficult to describe.
The most obvious veiled unemployment cases are where there are fewer jobs than unemployed workers even when wages are allowed to adjust, so even if all vacancies are to be filled, some unemployed workers will still be there. This happens with cyclical unemployment, because macroeconomic forces cause unemployment of microeconomics that can backfire and exacerbate this macroeconomic power.
Classic unemployment
Classic unemployment, or real wages, occurs when the real wage for a job is set above the market opening level that causes the number of job seekers to exceed the number of job openings. On the other hand, most economists argue that when wages fall below habitable wages, many choose to fall out of the labor market and no longer find work. This is especially true in countries where low-income families are supported through the public welfare system. In such cases, wages must be high enough to motivate people to choose a job rather than what they receive through public welfare. Wage under habitable wages tends to result in lower labor market participation in the scenarios mentioned above. In addition, it should be noted that the consumption of goods and services is a key driver of the increasing need for labor. Higher wages cause workers to have more income available to consume goods and services. Therefore, higher wages increase general consumption and as a result demand for labor increases and unemployment declines in the economy Many economists argue that unemployment increases with increasing government regulations. For example, minimum wage legislation raises the cost of some low-skilled workers over market equilibrium, resulting in increased unemployment because people who want to work at tariffs can not (because new and higher wages are now higher than their labor rates). Laws that limit layoffs can make businesses less likely to rent in the first place, as hiring becomes more risky.
However, this argument oversimplifies the relationship between wage rates and unemployment, ignoring many factors, contributing to unemployment. Some, such as Murray Rothbard, suggest that even social taboos can prevent wages from falling to the market opening level.
In Out of Employment: Unemployment and Governance in the Twentieth-Century America, economists Richard Vedder and Lowell Gallaway argue that the empirical record of wage, productivity, and unemployment rates in America justifies the classical unemployment theory. Their data showed a strong correlation between adjusted real wages and unemployment in the United States from 1900 to 1990. However, they maintained that their data did not take into account exogenous events.
Cyclic unemployment
Lonely, lacking-demand, or Keynesian unemployment occurs when there is not enough aggregate demand in the economy to provide jobs for everyone who wants to work. Demand for most goods and services falls, less production is needed and consequently fewer workers are needed, wages are rigid and do not fall to meet the equilibrium level, and the outcome of mass unemployment. Its name comes from a frequent shift in business cycles although unemployment can also be persistent as it did during the Great Depression of the 1930s.
With cyclical unemployment, the number of unemployed workers exceeds the number of job vacancies, so even if full employment is achieved and all open work is filled, some workers will remain unemployed. Some associate cyclical unemployment with frictional unemployment because factors that cause friction are partly caused by cyclical variables. For example, a sudden drop in the money supply can shock rational economic factors and suddenly hamper aggregate demand.
Keynesian economists on the other hand see a lack of supply for jobs as potentially addressed by government intervention. One suggested intervention involves spending deficits to improve jobs and demand. Other interventions involve expansionary monetary policies that increase the money supply that should lower interest rates that should lead to increased non-governmental spending.
Marxian unemployment theory
It is the nature of capitalist production to work too hard on some workers while preserving the rest as the unemployed poor reserves.
Marxists share the Keynesian view of the relationship between economic and job demand, but with a warning that the tendency of the market system to cut wages and reduce labor participation at the firm level leads to a decline in aggregate demand required in the economy as a whole, causing the unemployment crisis and periods of low economic activity the accumulation of capital (investment) phase of economic growth can continue.
According to Karl Marx, unemployment is inherent in an unstable capitalist system and massive periodic unemployment crisis will occur. He theorizes that unemployment is inevitable and even an essential part of the capitalist system, with recovery and regrowth also part of the process. The function of the proletariat in the capitalist system is to provide a "labor reserve army" which creates downward pressure on wages. This is achieved by dividing the proletariat into surplus labor (employee) and not working (unemployed). These reserve workers are fighting among themselves for rare jobs with lower and lower wages.
At first glance, unemployment seems inefficient because unemployed workers do not increase profits, but unemployment benefits in the global capitalist system because unemployment lowers wages that are cost from the owner's perspective. From this perspective, low wages benefit the system by reducing economic rents. However, it does not benefit workers; in the Marxist society, the workers (the proletariat) work to benefit the bourgeoisie through the production of their capital. The capitalist system unfairly manipulates the labor market by perpetuating the unemployment that lowers the demands of the workers on a fair wage. Workers are pitted against each other with increased profit services for owners. As a result of the capitalist mode of production, Marx argues that workers experience alienation and estrangement through their economic identities.
According to Marx, the only way to permanently eliminate unemployment is to remove capitalism and the system of forced competition for wages and then turn to socialist or communist economic systems. For contemporary Marxists, the continued existence of unemployment is evidence of the inability of capitalism to ensure full employment.
Full job
In demand-based theory, it is possible to eliminate cyclical unemployment by increasing aggregate demand for products and workers. However, eventually the economy hit the "inflation barrier" imposed by four other types of unemployment as far as they exist. Historical experience shows that low unemployment affects inflation in the short term but not long term. In the long run, the turnover of the size of the money supply such as MZM ("zero maturity of money", which represents cash and equivalent demand deposits) is much more predictable than the low unemployment rate.
Some theoretical economists see the inflation barrier as conforming to the natural rate of unemployment. The "natural" unemployment rate is defined as the unemployment rate that exists when the labor market is in equilibrium and there is pressure not to raise the rate of inflation or the fall in the rate of inflation. Alternative technical terms for this level are NAIRU, or Non-Accelerating Inflation Rate of Unemployment . No matter what the name implies, demand theory says that this means that if the unemployment rate becomes "too low," inflation will increase without wage and price controls (income policy).
One of the main problems with NAIRU's theory is that no one knows exactly what it is NAIRU (while it clearly changes over time). The margin of error can be very high relative to the actual unemployment rate, making it difficult to use NAIRU in policy making.
Another definition, normative, about full employment can be called the ideal unemployment rate. This will exclude all types of unemployed representing inefficiency forms. This type of unemployment "full-time job" will only relate to frictional unemployment (excluding the parts that drive McJob's management strategy) and thus will be very low. However, it is impossible to achieve this full-employment target using only the demand-side Keynesian stimulus without getting under NAIRU and leading to accelerating inflation (no revenue policy). A training program aimed at combating structural unemployment will help here.
As long as hidden unemployment exists, it implies that official unemployment statistics provide poor guidance for what unemployment rates coincide with "full employment".
Structural unemployment
Structural unemployment occurs when the labor market can not provide jobs for everyone who wants it because there is a mismatch between the unemployed worker's skills and the skills needed for the job available. Structural unemployment is difficult to separate empirically from frictional unemployment, except to say that it lasts longer. As with frictional unemployment, a simple demand-side stimulus will not work to easily eliminate this type of unemployment.
Structural unemployment can also be encouraged to increase with persistent cyclical unemployment: if the economy suffers from low long-term aggregate demand, it means that many unemployed become desperate, while their skills (including job-seeking skills) become "rusty" and obsolete. Problems with debt can lead to homelessness and fall into a vicious cycle of poverty.
This means that they may not fit into the job openings created when the economy recovers. The implication is that sustained high demand can lower structural unemployment. The theory of persistence in structural unemployment has been referred to as an example of path dependence or "hysteresis".
Many tech unemployed , due to the replacement of workers by machines, may be counted as structural unemployment. Alternatively, technological unemployment may refer to a way of a steady increase in labor productivity meaning that fewer workers are required to produce the same level of output each year. The fact that aggregate demand can be increased to address this issue suggests that this problem is not one of cyclical unemployment. As indicated by Okun's Law, the demand side should grow fast enough to absorb not only the growing labor force but also the workers who are made redundant by the increase in labor productivity.
Seasonal unemployment can be seen as some sort of structural unemployment, as this is the type of unemployment associated with certain types of work (construction work, migratory farm work). The most cited official unemployment size removes this type of unemployment from statistics using the "seasonal adjustment" technique. This results in large and permanent structural unemployment.
Frictional Unemployment
Frictional unemployment is the period of time between jobs when a worker is looking for, or transition from one job to another. Sometimes called search unemployment and can be voluntary based on the state of the unemployed individual.
Frictional unemployment exists because work and workers are heterogeneous, and discrepancies can occur between supply and demand characteristics. Such misalignment can be attributed to skills, payments, working time, location, seasonal industry, attitudes, tastes, and many other factors. New arrivals (such as graduate students) and newcomers (such as former housewives) can also suffer from a frictional spell of unemployment.
Workers and employers receive certain levels of imperfection, risk or compromise, but usually not immediately; they will invest time and effort to find a better partner. This is actually beneficial for the economy because it generates better resource allocation. However, if the search is too long and incompatibility too often, the economy suffers, because some work will not be completed. Therefore, the government will look for ways to reduce unnecessary frictional unemployment through various means including providing education, advice, training, and assistance such as day care centers.
Friction in the labor market is sometimes graphically depicted with the Beveridge curve, a downward sloping curve showing the correlation between the unemployment rate on one axis and the vacancy rate on the other. Changes in supply or demand for labor-causing movement along this curve. An increase (decrease) in the labor market friction will shift the curve outwards (inside).
Hidden unemployment
Hidden, or closed, unemployment is a potential jobless unemployment that is not reflected in official unemployment statistics, because of the way statistics are collected. In many countries, only those who are unemployed but actively seeking employment (and/or eligible for social security benefits) are considered unemployed. Those who have given up seeking employment (and sometimes those in government "re-training" programs) are not counted officially among the unemployed, even if they are not working.
Statistics also do not count "underemployment" - those who work less than they want or in jobs that do not take advantage of their capabilities well. In addition, those who work in age but currently in full-time education are usually not considered unemployed in government statistics. The indigenous peoples of the traditional unemployed who survive by collecting, hunting, shepherding, and farming in the wilderness, may or may not be counted in unemployment statistics. Official statistics often underestimate the unemployment rate due to hidden unemployment.
Long-term unemployment
Long term unemployment is defined in EU statistics, as unemployment lasts more than one year. The United States Bureau of Labor Statistics (BLS), which reports the current long-term unemployment rate of 1.9 percent, defines this as unemployment lasting 27 weeks or longer. Long-term unemployment is a structural unemployment component, which results in long-term unemployment in every social, industrial, occupational, and all levels of education.
Maps Unemployment
Measurement
There are also various ways national statistical agencies measure unemployment. These differences may limit the validity of the international comparison of unemployment data. To some extent, these differences persist even though national statistical agencies are increasingly adopting the definition of unemployment by the International Labor Organization. To facilitate international comparison, several organizations, such as the OECD, Eurostat, and International Comparative Programs, adjusted data on unemployment for comparison between countries.
Although many people care about the number of unemployed people, economists usually focus on the unemployment rate. This corrects the normal increase in the number of people employed due to increased population and increased labor force relative to population. The unemployment rate is expressed as a percentage, and is calculated as follows:
As defined by the International Labor Organization, "unemployed workers" are those who are currently not employed but willing and able to work to pay, are currently available for work, and have been actively seeking employment. Individuals who actively seek employment should seek to: relate to an employer, have a job interview, contact a job placement agent, send a resume, submit an application, respond to advertising, or some other way to find active employment in before four weeks. Simply viewing the ad and not responding will not count as active looking for a job placement. Since not all unemployed may be "open" and counted by government agencies, official statistics on unemployment may be inaccurate. In the United States, for example, the unemployment rate does not consider people who are not actively looking for a job, like those who are still in college.
The ILO explains four different methods for calculating the unemployment rate:
- The Labor Force Survey is the most preferred method of calculating unemployment rates because they provide the most comprehensive results and enable unemployment calculations by different categories of groups such as race and gender. This method is most comparable internationally.
- Official Estimates are determined by a combination of information from one or more of the other three methods. The use of this method has decreased in support of the Labor Survey.
- Social Insurance Statistics such as unemployment benefits, calculated on the basis of the number of insured persons representing the total workforce and the number of insured persons collecting benefits. This method has been heavily criticized for the expiration of benefits before the person finds a job.
- Employment Office statistics are the least effective because they only include monthly unemployment calculations entering the labor office. This method also includes unemployed unemployed under the ILO definition.
The main size of unemployment, U3, allows comparison between countries. Unemployment differs from country to country and across different time periods. For example, during the 1990s and 2000s, the United States had a lower unemployment rate than many countries in the European Union, which had significant internal variation, with countries like England and Denmark beating Italy and France. However, major economic events such as the Great Depression can cause similar unemployment rates worldwide.
European Union (Eurostat)
Eurostat, the European Union's statistical office, defines unemployment as people aged 15 to 74 who are not working, have been looking for work in the last four weeks, and are ready to begin work within two weeks, which complies with ILO standards. Both the actual amount and the unemployment rate are reported. Statistical data is available by member countries, to the EU as a whole (EU28) as well as to the euro area (EA19). Eurostat also includes long-term unemployment rates. It is defined as part of unemployment that has been idle for more than 1 year.
The main sources used are the EU Workforce Survey (EU-LFS). EU-LFS collects data in all member countries every quarter. For monthly calculations, national surveys or national lists of labor offices are used in conjunction with quarterly EU-LFS data. Appropriate calculations for each country, generating monthly data aligned, depending on availability of data.
The United States Bureau of Labor Statistics
The Bureau of Labor Statistics measures employment and unemployment (of those over 15 years old) using two different labor surveys conducted by the US Census Bureau (within the United States Department of Commerce) and/or Bureau of Labor Statistics (within the Department of Labor Working United States) that collects job statistics every month. The Current Population Survey (CPS), or "Household Survey", conducted a survey based on a sample of 60,000 households. This survey measures the unemployment rate based on the ILO definition.
The Current Employment Statistics Survey (CES), or "Payroll Survey", conducts surveys based on a sample of 160,000 businesses and government agencies representing 400,000 individual entrepreneurs. This survey only measures civilian nonfarm work; so, this does not count the unemployment rate, and that's different from the ILO's unemployment rate definition. Both of these sources have different classification criteria, and usually produce different results. Additional data are also available from the government, such as the weekly unemployment claims weekly report available from the Office of Labor Security, within the US Department of Labor & amp; Training Administration. The Bureau of Labor Statistics provides the latest numbers through the PDF linked here. BLS also provides a concise Summary of Work at present, updated monthly.
The Bureau of Labor Statistics also calculates six measures of unemployment replacement, U1 to U6, which measures various aspects of unemployment:
- U1: Percentage of unemployed workforce 15 weeks or longer.
- U2: Percentage of workforce who lost their jobs or completed temporary jobs.
- U3: The official unemployment rate per ILO definition occurs when people are out of work and they are actively looking for work in the last four weeks.
- U4: U3 "desperate workers", or those who quit looking for jobs because of current economic conditions make them believe that no jobs are available to them.
- U5: U4 "other fringe worker", or "loosely bonded worker", or those who "want" and can work, but have not been looking for a job recently.
- U6: U5 Part time workers who want to work full time, but can not for economic reasons (underemployment).
Note: "Marginalized worker" is added to the total labor force total for the calculation of the unemployment rate for U4, U5 and U6. BLS revised the CPS in 1994 and among the size changes representing the official unemployed rate was renamed to U3 instead of U5. In 2013, the Hunter Representative proposed that the Bureau of Labor Statistics use the U5 level instead of the current U3 level.
Statistics for the US economy as a whole hide the variation between groups. For example, in January 2008 the US unemployment rate was 4.4% for adult men, 4.2% for adult women, 4.4% for Caucasians, 6.3% for Hispanics or Latin (all races), 9.2 % for African Americans, 3.2% for Asian Americans, and 18.0% for teenagers. In addition, the US unemployment rate will be at least 2% higher if prisoners and prisoners in jails are counted.
The unemployment rate is included in a number of major economic indices including the United States Leaders Conference Indicator Index, a macroeconomic measure of economic circumstances.
Alternative
Limitations of the definition of unemployment
Some critics believe that the current method of measuring unemployment is not accurate in terms of the impact of unemployment on people because this method does not account for 1.5% of the available working population jailed in US jails (who may or may not work while in jail), those who lose their jobs and become desperate from time to time from actively seeking employment, self-employed or self-employed, such as traders or building contractors or IT consultants, those who have retired before the official retirement age but still want to work (early retirement voluntarily ), those with disability pensions who, despite not having full health, still want to work in jobs appropriate for their medical condition, those who work for payments only one hour per week but want to work full time.
These people are "part-time without volunteer" workers, those who are underemployed, for example, a computer programmer who works at a retail store until he can find a steady job, a temporary housewife who prefers to work, and graduates and students Professional schools are unable to find useful work after they graduate with their undergraduate degree.
Internationally, the unemployment rates of some countries are sometimes muted or appear less severe because of the number of individual entrepreneurs working in agriculture. Small independent farmers are often considered self-employed; so, they can not idle. The impact of this is that in non-industrialized countries, such as the United States and Europe during the early 19th century, overall unemployment was around 3% because so many individuals were self-employed, independent peasants; however, unemployment outside agriculture is as high as 80%.
Many economies are industrializing and experiencing an increase in the number of non-agricultural workers. For example, US nonfarm labor increased from 20% in 1800, to 50% in 1850, to 97% in 2000. The shift from self-employment increased the percentage of the population included in the unemployment rate. When comparing unemployment rates between countries or time periods, consider the differences in their level of industrialization and entrepreneurship.
In addition, job size and unemployment may be "too high". In some countries, the availability of unemployment benefits may increase the statistics because they provide incentives to register as unemployed. People who are not looking for a job may choose to claim themselves to be unemployed to benefit; people with undeclared paying jobs may try to get unemployment benefits in addition to the money they generate from their work.
However, in countries such as the United States, Canada, Mexico, Australia, Japan and the EU, unemployment is measured using a sample survey (similar to a Gallup poll). According to BLS, a number of Eastern European countries have implemented labor surveys as well. The sample survey has its own problems because the total number of workers in the economy is calculated based on the sample rather than the census.
It is possible to be unemployed or unemployed by the ILO definition, which is outside the "labor force". They are people who do not have jobs and are not looking for work. Many of these people go to school or have retired. Family responsibilities get others out of the workforce. Others have physical or mental disabilities that prevent them from participating in labor force activities. Some people just choose not to work preferring to depend on others for sustenance.
Typically, employment and labor include only work done for monetary gain. Therefore, a housewife is not part of the labor force or unemployed. Nor are full-time students or detainees considered part of the labor force or unemployed. The latter can be important. In 1999, economists Lawrence F. Katz and Alan B. Krueger estimated that the increase in detention reduced the unemployment rate measured in the United States by 0.17% between 1985 and the late 1990s.
In particular, in 2005, about 0.7% of the US population was jailed (1.5% of the available work population). In addition, children, the elderly, and some individuals with disabilities are usually not counted as part of the labor force and are not included in unemployment statistics. However, some parents and many disabled people are active in the labor market
In the early stages of the economic boom, unemployment often increased. This is because people join the labor market (giving up learning, starting job hunting, etc.) As a result of an increase in the job market, but until they actually find their positions counted as unemployed. Similarly, during a recession, an increase in the unemployment rate is moderated by people who leave the workforce or are otherwise discounted from the workforce, as with entrepreneurs.
For the fourth quarter of 2004, according to the OECD, (Source Employment Outlook 2005 ISBN 92-64-01045-9), normalized unemployment for men aged 25 to 54 was 4.6% in the US and 7.4% in France. At the same time and for the same population, the employment rate (number of workers divided by population) was 86.3% in the US and 86.7% in France. This example shows that the unemployment rate is 60% higher in France than in the US, but more people in this demographic work in France than in the US, contrary to intuition if the estimated unemployment rate reflects the health of market workers.
Because of this shortage, many labor market economists prefer to look at various economic statistics such as labor market participation rates, the percentage of people aged between 15 and 64 who are currently employed or looking for work, the total amount of full-time jobs in the economy, the number of people searching work as a raw number and not a percentage, and the number of hours a person works in a month compared to the number of people who want to work. In particular, NBER does not use the unemployment rate but prefers different levels of work to date.
Labor force participation rate
The labor force participation rate is the ratio between the labor force and the overall size of their group (national population of the same age range). In the West, during the second half of the 20th century, the labor force participation rate increased significantly, due to an increase in the number of women entering the workplace.
In the United States, there are four significant stages of women's participation in the workforce - rising in the 20th century and declining in the 21st century. The participation of the male labor force decreased from 1953 to 2013. Since October 2013 men have increasingly joined the labor force.
During the late 19th century to the 1920s, very few women worked outside the home. They are young single women who usually withdraw from the labor force to marry unless the family needs two income. These women work primarily in the textile manufacturing industry or as domestic workers. This profession empowers women and allows them to earn decent wages. Sometimes, they are financial aid for their families.
Between 1930 and 1950, the participation of the female labor force increased primarily due to increased demand for office workers, the participation of women in the secondary school movement, and due to electrification that reduced the time spent on housework. Between the 1950s and early 1970s, most women were secondary recipients working mainly as secretaries, teachers, nurses, and librarians (pink collar jobs).
Between the mid-1970s and the late 1990s, there was a period of female revolution in the labor force caused by different sources of factors. Women are more accurate planning their future in the world of work, investing in more applicable majors in college that prepares them to enter and compete in the labor market. In the United States, the rate of female labor participation increased from about 33% in 1948 to a peak of 60.3% in 2000. As of April 2015, the participation of the female labor force was 56.6%, the labor force participation rate of men was 69.4% and a total of 62.8%.
A general theory in modern economics claims that the emergence of women who participated in the US labor force in the 1950s to the 1990s was due to the introduction of new contraceptive technologies, birth control pills, and age-old adjustment of majority laws. The use of birth control gives women the flexibility of choosing to invest and advance their careers while maintaining relationships. By having control over their fertility time, they do not run the risk of thwarting their career choices. However, only 40% of the population actually uses birth control pills.
This implies that other factors may have contributed to women choosing to invest in advancing their careers. One factor may be that more men delay the age of marriage, allowing women to get married later on without worrying about the quality of older men. Other factors include changing the nature of the work, with machines replacing physical labor, eliminating many traditional male jobs, and the rise of the service sector, where many jobs are gender-neutral.
Another factor that may have contributed to the trend is The Equal Pay Act of 1963, which aims to remove wage disparities by sex. The law reduces sexual discrimination and encourages more women to enter the labor market by receiving a fair wage to help raise families and children.
At the turn of the 21st century labor force participation began to reverse the long period of improvement. Reasons for this change include an increase in older workers, increased enrollment rates among young workers and reduced participation of female labor force.
The labor force participation rate may decrease as the rate of population growth exceeds that of employed and unemployed. Labor force participation rates are a key component in long-term economic growth, almost as important as productivity.
The historic shift begins around the end of a major recession as women begin to leave the workforce in the United States and other developed countries. The rate of female labor force participation in the United States has continued to decline since 2009 and by April 2015 the rate of female labor force participation has returned to the 1988 level of 56.6%.
Participation levels are defined as follows:
The labor force participation rate explains how increased unemployment rates can occur along with increased employment. If a large number of new workers enter the workforce but only a small percentage are employed, then an increase in the number of unemployed workers may exceed growth in employment.
Unemployment rate
The unemployment rate calculates the unemployment share for the entire population. In particular many young people between the ages of 15 and 24 are studying full-time and therefore are not working or looking for work. This means they are not part of the labor force used as a denominator to calculate the unemployment rate. The youth unemployment rate in the EU ranges from 5.2 (Austria) to 20.6 percent (Spain). This is much lower than the standard youth unemployment rate, ranging from 7.9 (Germany) to 57.9 percent (Greece).
Effects
High and persistent unemployment, where economic inequality is rising, has a negative effect on future long-term economic growth. Unemployment can jeopardize growth not only because it is a waste of resources, but also because it generates subsequent redistributive and distorting pressures, pushing people into poverty, limiting liquidity limiting labor mobility, and eroding self-esteem that encourages social dislocation, riots and conflict. 2013 Economic Nobel Prize winner Robert J. Shiller says that increasing inequality in the United States and elsewhere is the most important issue.
Cost
Individual
Individuals who are unemployed can not make money to meet financial obligations. Failure to pay mortgage payments or pay rent can lead to homelessness through foreclosures or expulsions. Across the United States, more and more people are displaced in a foreclosure crisis that produces tent cities.
Unemployment increases susceptibility to cardiovascular disease, somatization, anxiety disorders, depression, and suicide. In addition, unemployed people have higher rates of drug use, poor diet, doctor visits, tobacco smoking, alcohol consumption, drug use, and lower levels of exercise. According to a study published in Social Indicator Research, even those who tend to be optimistic find it difficult to see the good side of things when unemployed. Using interviews and data from German participants aged 16 to 94 - including individuals facing real-life pressure and not just a population of volunteer students - the researchers determined that even optimists struggle with being unemployed.
In 1979, Brenner found that for every 10% increase in the number of unemployed there was an increase of 1.2% in mortality, 1.7% increase in cardiovascular disease, 1.3% more cases of cirrhosis, 1.7% more cases suicide, and more% arrests, and 0.8% more attacks reported to the police.
A study by Ruhm, in 2000, about the effects of recession on health found that some health measures actually increased during the recession. As for the impact of the economic downturn on crime, during the Great Depression the crime rate did not decrease. Unemployment in the US often uses welfare programs such as Food Stamps or collecting debts because unemployment insurance in the US generally does not replace most of the income earned in the workplace (and one can not accept such assistance indefinitely).
Not everyone is suffering from unemployment. In a prospective study of 9570 individuals for four years, very meticulous people suffered more than doubled if they became unemployed. The authors suggest this may be because the meticulous people make different attributions about why they become unemployed, or through experiencing a stronger reaction after failure. There is also the possibility of inverse causality from poor health to unemployment.
Some researchers argue that many low-income jobs are not a truly better option than unemployment with the welfare state (with unemployment insurance benefits). But because it is difficult or impossible to get unemployment insurance benefits without ever working in the past, this job and unemployment are more complementary than the substitute. (This work is often short-term, either by students or by those trying to gain experience, turnover in most low-paying jobs.)
Another cost for unemployment is that the combination of unemployment, lack of financial resources, and social responsibility can encourage unemployed workers to take jobs that do not fit into their skills or allow them to use their talents. Unemployment can lead to underemployment, and the fear of losing a job can spur psychological anxiety. As well as anxiety, it can lead to depression, lack of confidence, and a large amount of stress. This stress increases when unemployed are faced with health problems, poverty, and lack of relational support.
Other private unemployment costs are their impact on relationships. A 2008 study from Covizzi, which examined the relationship between unemployment and divorce, found that divorce rates were greater for couples when one partner was unemployed. However, more recent research finds that some couples often unite in "unhappy" or "unhealthy" marriages when unemployed to support financial costs. A study of 2014 by Van der Meer found that stigma derived from unemployment affects personal well-being, especially for men, who often feel their masculinity identity threatened by unemployment.
Unemployment can also bring personal costs in relation to gender. One study found that women were more likely to experience unemployment than men and that they tend to move from a temporary position to a permanent position. Other studies on gender and unemployment find that men, however, are more likely to experience greater stress, depression, and the ill effects of unemployment, largely deriving from perceived threats to their role as breadwinners. The study found that men expect themselves to be seen as "less manly" after a job loss than they really are, and as a result they engage in compensatory behavior, such as financial risk taking and increased assertiveness, therefore.
Unemployment costs also vary depending on age. The young and the elderly are the two largest age groups that are currently experiencing unemployment. A 2007 study from Jacob and Kleinert found that young people (ages 18 to 24) who had fewer resources and limited work experience were more likely to be unemployed. Other researchers have found that senior high school seniors currently place lower value on the job than in the past, and this may be because they recognize the availability of limited jobs. At the other end of the age spectrum, research has found that older individuals have more obstacles than younger workers to work, requiring stronger social networks to find work, and also tend not to move from a temporary position to a permanent position. In addition, some older people see age discrimination as the reason they are not employed.
Social
The economy with high unemployment rates does not use all the resources, especially labor, is available for it. Because it operates below the limits of production possibilities, it could have a higher output if all the useful workforce is used. However, there is a trade-off between economic efficiency and unemployment: if frictional unemployment receives the first job offered, they are likely to operate below their skill level, reducing economic efficiency.
During periods of long unemployment, workers can lose their skills, causing the loss of human capital. Being unemployed can also reduce the life expectancy of workers for about seven years.
High unemployment can encourage xenophobia and protectionism because workers fear that foreigners steal their jobs. Efforts to preserve existing employment from domestic and indigenous workers include legal barriers to "outsiders" who want jobs, barriers to immigration, and/or tariffs and similar trade barriers to foreign competitors.
High unemployment can also cause social problems such as crime; if people have less income than before, it is quite possible that the level of crime in the economy will increase.
A 2015 study published in The Lancet estimates that unemployment causes 45,000 suicides a year worldwide.
Socio-political
High unemployment rates can be the cause of civil unrest, in some cases leading to revolution, and especially totalitarianism. The fall of the Weimar Republic in 1933 and Adolf Hitler's rise to power, culminating in World War II and the deaths of tens of millions and the destruction of most of Europe's physical capital, were attributed to the poor economic conditions in Germany at the time, in particular a high unemployment rate above 20 %; see the Great Depression in Central Europe for details.
Note that hyperinflation in the Weimar Republic is not directly blamed for the Nazi revival - Hyperinflation in the Weimar Republic occurred mainly in the period 1921-23, which was contemporary with Hitler's Beer Hall Putsch in 1923, and blamed for undermining the credibility of democratic institutions, but the Nazis did not assume government until 1933, ten years after hyperinflation but in the midst of high unemployment.
Increased unemployment has traditionally been perceived by the public and the media in any country as the main guarantor of electoral defeat for the supervising government. This was very much a consensus in Great Britain until 1983, when Conservative Margaret Thatcher's government won a landslide victory, despite overseeing an increase in unemployment from 1,500,000 to 3,200,000 since the election four years earlier.
Benefits
The main benefit of unemployment is that people are available to be employed, without having to be kept away from their existing employers. This allows new and old businesses to take on staff.
Unemployment is considered "beneficial" to unemployed people in the sense that it avoids inflation, which in itself has a destructive effect, by giving (in Marxian terms) a labor reserve force, which keeps wages under control. However, the direct link between full local employment and local inflation has been debated partly because of the recent increase in international trade that supplies low-priced goods even as the rate of local employment rises to full employment.
Full employment can not be achieved because workers will shirk, if they are not threatened with the possibility of unemployment. The curve for the condition without negligence (labeled NSC) goes to infinity at full employment as a result. The benefit of fighting inflation against the whole economy that arises from the expected unemployment rate has been studied extensively. The Shapiro-Stiglitz model shows that wages are not bargained enough to reach 0% unemployment. This happens because employers know that when wages are reduced, workers will neglect and spend less effort. Employers avoid negligence by preventing wages from falling so low that workers give up and become unproductive. This higher wage captures unemployment while the threat of unemployment reduces negligence.
Before the current level of world trade is developed, unemployment is shown to reduce inflation, follow the Phillips curve, or to reduce inflation, following the NAIRU/natural rate of unemployment theory, as it is relatively easy to find new jobs without losing a person's current. one. And when more jobs are available for fewer workers (low unemployment), this allows workers to find jobs that are more suited to their tastes, talents, and needs.
As in Marxian unemployment theory, special interest can also be useful: some employers may expect that employees who are not afraid to lose their jobs will not work hard, or will demand an increase in wages and benefits. According to this theory, unemployment can increase labor productivity in general and profitability by increasing employers' reasons for their monopsony (and profit) strength.
Optimal unemployment has also been maintained as an environmental tool to curb accelerated GDP growth to maintain sustainable levels in the context of resource constraints and environmental impacts. But the tools of denying jobs for workers who are willing to appear blunt instruments to conserve resources and the environment - reducing unemployment consumption across the board, and only in the short term. The full employment of the idle workforce, all focused on the goal of developing more environmentally efficient methods for production and consumption, can provide a more significant and lasting cumulative environmental benefit and reduce resource consumption. If so then the economy and the labor force in the future will benefit from the structural improvements generated in sustainable GDP growth rates.
Some critics of the "work culture" like anarchist Bob Black see work as being culturally important in modern countries. Such critics often propose quitting the job if possible, working less, reassessing the cost of living for this purpose, creating "fun" jobs as opposed to "work," and creating cultural norms in which work is seen as unhealthy. These people advocate "anti-work" ethics for life.
Reject working hours
As a result of productivity, the working week greatly decreased during the 19th century. In 1920 in the US the average working week was 49 hours, but the working week was reduced to 40 hours (after which premium overtime was applied) as part of the National Industrial Recovery Act of 1933. At the time of the Great Depression of the 1930s, it was believed that due to the enormous increase in productivity due to electrification, mass production and agricultural mechanization, no large number of previously hired workers are required.
Controlling or reducing unemployment
The community tried a number of different actions to get as many people as possible into the work, and various communities had experienced almost full-time jobs, especially during post-World War II economic expansion. Britain in the 1950s and 1960s averaged a loss of 1.6 per cent, while in Australia the 1945 White Paper on Full Employment in Australia defined the government's policy of full employment, whose policies lasted until the 1970s, when the government runs out of money.
However, the mainstream economic discussions of full employment since the 1970s show that efforts to reduce unemployment rates below natural unemployment rates will fail, resulting in fewer outputs and more inflation.
Request-side solutions
Increased labor demand will drive the economy along the demand curve, increasing wages and jobs. The demand for labor in the economy comes from the demand for goods and services. Thus, if demand for goods and services in the economy increases, the demand for labor will increase, increase employment and wages.
There are many ways to stimulate demand for goods and services. Increasing wages to the working class (those who are more likely to spend increased funds on goods and services, than on savings, or commodity purchases) is one of the proposed theories. Increased wages are believed to be more effective in increasing demand for goods and services than the central bank's strategy of putting increasing money supply largely into the hands of wealthy people and institutions. Monetaris suggests that increasing the money supply in general will increase short-term demand. The long-term increase in demand will be negated by inflation. An increase in fiscal spending is another strategy for increasing aggregate demand.
Providing assistance to the unemployed is a strategy used to prevent a reduction in the consumption of goods and services that can lead to a vicious cycle of further job loss and a further decline in consumption/demand. Many countries help the unemployed through social welfare programs. These unemployment benefits include unemployment insurance, unemployment compensation, welfare and subsidies to help retrain. The main goal of the program is to reduce short-term difficulties and, more importantly, to allow workers more time to find work.
A direct demand side solution for unemployment is government-funded work from poor able-bodied people. This was primarily carried out in England from the 17th to the 1948 centuries at the social worker institution, providing jobs for the unemployed under harsh conditions and low wages to hinder their use. The modern alternative is job security, where government guarantees work with living wages.
Temporary measures may include public works programs such as Job Progress Administration. Government-funded work is not widely supported as a solution to unemployment, except in times of crisis; this is attributed to the existence of public sector jobs depending directly on tax revenues from private sector employment.
In the US, unemployment insurance benefits received are only based on previous earnings (not working time, family size, etc.) and usually compensate one-third of the previous income. To qualify, a person must stay in their own country for at least one year and work. This system was established by the Social Security Act of 1935. Although 90% of the population is covered by unemployment insurance, less than 40% apply and receive benefits. However, the number of filed and receiving benefits increased during the recession. In the case of highly seasonal industries, these systems provide income to workers during the off season, thus encouraging them to remain attached to the industry.
According to classical economic theory, markets reach equilibrium where inventory equals demand; every one who wants to sell at a market price can. Those who do not want to sell at this price are not; in the labor market this is a classic unemployment. Monetary policy and fiscal policy can be used to promote short-term economic growth, increase labor demand and reduce unemployment.
Bid solutions side
However, the labor market is not 100% efficient, although it may be more efficient than bureaucracy. Some argue that minimum wages and union activities keep wages from falling, which means that too many people want to sell their labor at an ongoing price but can not. This assumes perfect competition exists in the labor market, in particular that there is no single entity large enough to affect wage levels and that employees have the same ability.
Advocates of supply-side policies are convinced that the policies can solve them by making the labor market more flexible. This includes removing minimum wages and reducing union strength. Supply-siders argue reforms increase long-term growth by reducing labor costs. This increase in the supply of goods and services requires more workers, increasing employment. It is said that supply-side policies, which include tax cuts for businesses and reduced regulation, create jobs, reduce unemployment and reduce the share of national income. Other supply-side policies include education to make workers more attractive to entrepreneurs.
History
There is a relatively limited historical record of unemployment because it is not always recognized or measured systematically. Industrialization meli
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