...cyclical and equilibrium unemployment. • Under this topic, we will cover the following: – Measurement and definitions, – Theories of U, – Economic costs of U, and – Solutions of U. 3 EMPLOYMENT AND UNEMPLOYMENT (Definitions and Measurement) • The unemployment rate: It is the ratio of the number of unemployed persons to the total number of persons in the labor force. It is usually expressed as a percentage. • The labor force consists of all those persons who are willing to work at a market equilibrium wage, and who either have jobs or are seeking work. 4 EMPLOYMENT AND UNEMPLOYMENT (Definitions and Measurement) • Discouraged workers: These are people who are willing to work at the going wage, but have given up looking actively for work, because they do not expect to find a job. • They are not registered for unemployment compensation because they have been unemployed too long to be eligible (under law of some countries). • So they are really unemployed but are not counted as unemployed. 5 EMPLOYMENT AND UNEMPLOYMENT (Definitions and Measurement) • U can be measured through the Claimant Count. • The claimant count is all those people claiming U related benefits. • Workforce jobs is a measure of...
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...Introduction On July 21, 2010, Legislation was approved by Congress extending the long awaited eligibility deadlines for benefit extensions to November 28, 2010. Soon thereafter, President Barack Obama signed into law the extension recovery for two and a half million Americans who lost their jobs in the recession. In the land of the free and the home of the brave, it begs to question the partisan’s behavior toward an action that would restore confidence in the American political administration and appropriate funds to the American working class that would help infuse spending, stimulating the economic recovery and bolstering the Democratic platform of all for one and one for all. This topic is especially close to me because like so many Americans that lost their jobs due to no fault of their own, I was also left unemployed through no fault of my own, so I have a vested interest in the outcome of the decisions that our government made on our behalf. This social issue has opened my eyes to the importance of politics and how our votes really do count. It made me realize how significant political policies really impact certain groups of people in different ways and how masterful a party can be by injecting negative influences into the public’s psyche. Review of Literature A study conducted by Daniel Aronson, Bhashkar Mazumder, and Shani Schechter of the Chicago Federal Reserve points out that as we entered 2010, the average length of an ongoing spell of unemployment in...
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...Unemployment benefits have consistently been cited by economists as one of the most effective policies at spurring economic growth. I feel strongly that the government should increase and extend unemployment benefits. My reasons for feeling this way are as follows. Currently the unemployment rate is still high and increasing the benefits will allow unemployed people a chance to pay more of their bills. Benefits provide much-needed income support during this time when many Americans would otherwise be left unable to pay their rent or put food on the table. Unemployment benefits have consistently been cited by economists as one of the most effective policies at spurring economic growth. Every week more than 2 million Americans receive an average emergency unemployment benefit check of about $300— money that is spent on rent or the mortgage and utilities, as well as in local supermarkets, pharmacies, gas stations, and newsstands. By increasing the money that the unemployed people put into the pockets they are most likely to spend it. Unemployment benefits help millions of Americans continue to feed their families and keep a roof over their heads even when they lose their job. In doing so, unemployment benefits are an important mechanism for preventing people from falling into poverty. The current unemployment rate is still high and increasing the benefits will allow unemployed people a chance to pay more of their daily living expenses. Americans are also finding themselves out...
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...Unemployment occurs when people are without work and actively seeking work. During periods of recession, an economy usually experiences a relatively high unemployment rate. According to International Labour Organization report, "More than 197 million people globally are out of work or 6% of the world's workforce was without a job in 2012. The unemployment rate is measured and calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labor force. The International Labour Organization has four different methods on calculating unemployment rates. The four methods of calculation are labour force sample surveys, official estimates, social insurance statistics, and employment office statistics. Sample surveys are a calculation of unemployment by different group categories such as race and gender. This method is the most internationally comparable. Official estimates are used from one or more of the other methods combined. The social insurance statistics are based on the number of people insured representing the total labour force and the number of people who are insured that are collecting benefits. This method has been heavily criticized due to the expiration of benefits before the person finds work. The last method, employment office statistics, includes a monthly tally of unemployed people who enter employment offices. This method also includes the unemployed who are not unemployed per the ILO definition. Unemployment can also...
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...is not an easy experience to become unemployed; however, this is becoming a reality in these traumatic economic times. The unemployment rate is high, unemployment benefits are running out, and the job growth is still at an all-time low. Although future programs look promising, the current regulations and obstacles the unemployed are facing today is in dire need of change. The current regulation and compensation laws provide unemployment benefits based on federal and state laws. This compensation programs is maintained by the state in which they provide benefits to the unemployed who qualify for unemployment insurance. “In Mississippi, the employer pays the cost of unemployment insurance. To be eligible to receive Mississippi unemployment benefits you must: • Be unemployed through no fault of your own • Be able to work • Be available to work • File a claim for benefits • Serve a one-week waiting period • Have earned sufficient wage credits • Be registered for work at the WIN Job and Claims Center in your area The amount of the benefit is determined by the amount of wages in your base period, which is the first four of the last five completed calendar quarters prior to the effective date of your claim” (Lawyers.com, 2010). While a few programs are in place to assist the unemployed there are obstacles preventing the unemployed from receiving benefits. Eligibility is one of the biggest obstacles that affect a majority of the unemployed. The employee’s who worked part-time...
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...Abstract Unemployment benefits are payments made by the states or other authorized bodies to unemployed people. Benefits may be based on a compulsory Para-governmental insurance system. Depending on the jurisdiction and the status of the person, those sums may be small, covering only basic needs thus a form of basic welfare, or may compensate the lost time regularly to the previous earned salary. They often are part of a larger social security scheme. Unemployment benefits are generally given only to those registering as unemployed, and often on conditions ensuring that they seek work and do not currently have a job. 1 million long-term unemployed Americans whose jobless benefits are phasing out this year as the federal government reels in Great Recession lifelines that provided unemployment checks for as long as 99 weeks in many states. By year's end, another 2 million will see their checks cut off sooner than were expected, because extended unemployment benefits will end beyond the standard 26 weeks that states pay for. Congress could renew the program, but many economists say that's unlikely. The cutbacks, required by a federal law passed in February, are already taking a toll. They are nudging some Americans into poverty, straining social services just as states and localities face their own budget distress and further crimping weak economic growth as those who lose benefits spend less. The number of jobless workers has fallen from over 15 million in early 2010 to...
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...the world (Torres, 2011). In the OECD countries, which are the first affected by the crisis, the main impact was the high level of unemployment generate by job losses, enterprise bankruptcies and cuts in the incomes of millions of people. Indeed, in April 2013, 8% of the OECD labour force was unemployed representing over 48 million people, almost 16 million more than in 2007 (Scarpetta, 2013). Despite the economic recovery in some of OECD countries mainly the United States, this trend could not improve until mid- 2014 so that we can observe a decrease in unemployment again. The governments should be concerned about the impact the unemployment because in general, this phenomenon affect not just the person himself but also his/her family and in the long run the society where he lives, which in turn affect negatively the functioning of the economy. Some of the well-known effects of unemployment on the economy are: * Unemployment financial costs: the government has to pay the unemployed some benefits, so the greater the number of the unemployed or the longer they are without work the more money the government has to shell out , * Spending power: the spending power of an unemployed person...
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...Unemployment From Wikipedia, the free encyclopedia Jump to: navigation, search For payments paid to unemployed people, see unemployment benefits. Unemployed men outside a soup kitchen in Depression-era Chicago, 1931. Unemployment (or joblessness) occurs when people are without work and actively seeking work.[1] The unemployment rate is a measure of the prevalence of unemployment and it is calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labor force. During periods of recession, an economy usually experiences a relatively high unemployment rate.[2] According to International Labour Organization report, more than 197 million people globally are out of work or 6% of the world's workforce were without a job in 2012.[3] There remains considerable theoretical debate regarding the causes, consequences and solutions for unemployment. Classical economics, New classical economics, and the Austrian School of economics argue that market mechanisms are reliable means of resolving unemployment. These theories argue against interventions imposed on the labor market from the outside, such as unionization, bureaucratic work rules, minimum wage laws, taxes, and other regulations that they claim discourage the hiring of workers. Keynesian economics emphasizes the cyclical nature of unemployment and recommends government interventions in the economy that it claims will reduce unemployment during recessions. This theory focuses...
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...the past several years. Everywhere you turn millions of people are struggling to find some type of work. Those that are jobless find often themselves losing their sense of self respect, purpose, and income. Many of them will have their homes and cars repossessed. Sadly enough it is not just the individuals themselves that are hurt, their families also struggle along with them. Many people in today’s society think that unemployment does not affect them. The sad truth is that unemployment affects everyone on several different levels. The government is affect by benefit to be paid out and loss of tax earnings, businesses are affected by less spending, the unemployed face loss of ability to survive, and in general every working individual has to pick up the expenses through their taxes (McClelland & Macdonald, 1998). What is Unemployment and The Causes To understand how unemployment affects society one must first understand what defines a person as being truly unemployed. Unemployment is defined as when individuals do not have a job and they are able, willing, and seeking some form of work (Tucker, 2001). Not everyone that does not have a job is included in the unemployment numbers. Some of these people include full time students, retired people, and the disabled, and those that are not actively seeking work. Then there is the discourage worker. These are people that want to work and were once seeking employment but have all but given up. Most of these workers will end up having...
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...The total number of registered unemployed has also grown rapidly from just over 50 000 in mid-2008 to almost 194 000 in March 2010, when it reached its maximum and started to diminish gradually (162 463 unemployed at the end of 2010). According to Eurostat data, the unemployment rate for those aged 15-64 years has reached its st d maximum of 20.7% in the 1 quarter 2010 and lowered slightly to 18,2% in the 3 quarter 2010: 17,2 20,1 9,4 Average in EU 20,7 10,2 19,8 22,0 20,0 18,0 16,0 14,0 12,0 10,0 12,2 8,9 10,4 14,3 8,8 7,5 6,8 9,6 8,0 6,0 4,0 Unemployment rate in Latvia 6,0 Unemployment rate in Latvia and the EU, EUROSTAT data At the end of 2007, average 30 000 registered unemployed were receiving unemployment benefits, and unemployment benefits’ expenses amounted 43.3 million LVL (61,7 MEUR); in 2008, 37 000 persons and 56.3 million LVL (80,2 MEUR); in 2009 – already 80 700 persons and 137.2 million LVL (195 MEUR) (almost three times more than in 2007). d Theeconomystartedtorecoverslowlyinthe3 quarterof2010,howevertheannualaverage growth rate for 2010 will still remain negative. Positive growth rate may be reached only in 2011. The social and economic situation in the country depends primarily on the stability of the macroeconomic environment – ability to develop the favourable environment for investors and entering of the foreign markets, to enhance possibilities for undertaking business...
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...Robertson, R., and Garber, T. (2011), the United States economy is at its worst since the Great Depression of the 1930’s. 13.9 million citizens are estimated to be out of work. Sixty percent of Americans get their health insurance through their employer; job loss most often equals health care benefit loss. Nearly three quarters of the adults who were laid of from their jobs and are uninsured delay getting health care or filling prescriptions because it is too expensive. The consequences are devastating in terms of individual and family health. Financially the devastation comes from huge medical debt, incurred during an already stressful time. There are few affordable insurance options for private health care plans. Public health insurance programs such as Medicaid and CHIP (Children’s Health Insurance Program) are available to only pregnant women, children, and parents with very low incomes. Childless adults are covered by less than half of the states. Adults under sixty-five years old could not find an individual plan that they could afford and thirty five percent were turned down because of a pre-existing health problem. Doty, M. (2011), states that individuals who purchase COBRA coverage may pay up to six times more for their coverage than when they were an employee. This is impossible for most unemployed people to afford and as a result most do not buy coverage. According to Lyons, B., Paradise, J., Perry, M., and Rudowitz, R. (2008), the impact of the economy has caused...
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...Comparison of Unemployment Policies with Other Countries (Their Effects and Results) Unemployment policies refers to those procedures that are put in place and are to be followed incase employed individuals loses their jobs. These kinds of policies are more common in developed countries and are meant to caution individuals from unexpected loss of their monthly income (Tanner 2003). The state may be directly involved in the administration of such policies or may authorize another organization to administer the policies. The benefits from unemployment policies depends on the country one resides and in most cases the policies are flexible implying that the benefits could only be covering the basic needs or may compensate the an individual proportionately according to previous monthly income. In Canada, the state has authorized services Canada which is under the supervision of minister of human development and social development Canada to administer the policy fund. The policy was previously known as unemployment insurance but was renamed to employment insurance in 2011 so as to eliminate the negative effect associated with the name. According to the insurance policy that is provided by the employment insurance an employee is required to pay premiums of 1.78% of the amount expected to be received in case they lose their jobs. The employer is also obliged to pay 140% of the amount contributed by employee towards the employee employment policy (Mendelson & Battle 2011)....
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...of unemployment policy in the UK today? Unemployment is a difficult concept to define as work itself can take many forms. For example work can be paid, unpaid, domestic or outside of the home. Even though with difficulties of defining a complex topic such as unemployment, Grint (1998, p36) defines unemployment as a situation of “being out of work” but “available for work”. This shows that even though people are willing and able to work they are unable to find paid work. Unemployment is a very concerning economic and social issue affecting the UK today and historically. According to the office national statistics, UK unemployment has increased from 7000 to 2.56 million. This particularly consists of youth unemployment, such as graduates and youths aged 17 plus who now rate at 21.2% of the unemployment rate, and women whose unemployment has also increased (BBC, 2013). As Beveridge states the population of those unemployed were supported through the ‘cradle of the grave’ suggesting that the government was giving unending unemployment benefits regardless of whether the population were actively seeking work. Unemployment policy regarding the workfare gained foothold after WW2 with the emergence of the welfare state. Today this is still the main policy for supporting the unemployed population of Britain. Those out of work now need to show that they are actively seeking work and gaining work experience and skills to make them more employable in the future. As mentioned above, unemployment...
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...4 Natural and cyclical unemployment ...............................................................................6 C. Introduction to Theories of Unemployment........................................... 7 D. Minimum Wages and Unemployment ................................................. 10 A simple minimum-wage model .................................................................................. 10 Minimum-wage effects on skilled and unskilled labor ..................................................... 11 E. Unemployment Insurance and the Length of Job Search .......................... 13 A simple model of job search ........................................................................................ 13 Unemployment benefits and search duration ................................................................. 15 Optimal search duration ............................................................................................. 17 F. Unions and Unemployment .............................................................. 18 An economy-wide labor union ..................................................................................... 18 A two-sector model of unions and unemployment .......................................................... 19 G. Sectoral Shifts and Unemployment...
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...Cause and Effects on Unemployment Tyrelle Leaks English115 Prof Ludvigsen August 30, 2015 Unemployment can occurs when a person who is actively searching for a job and is unable to find work. It can also be from a person being laid off from a job. This can affect an individual and their family because you need an income to make a living. There are many reasons why someone who is able and wants to work can be unemployed. It starts with your education because without a high school diploma or GED, It’s hard to get employed. Performance issues which a person can lack the skills to perform their duties on the job. Economic condition is another reason why a person becomes unemployed. Mismatch between available workers and position to be filled can affect employment as well. Lack of experience also takes a big part of staying employed. In every society, there will always be a number of people who are unemployed. The reason why is because of the fact that there are not enough jobs for everyone. It really depends on the individual and their skills. There are many reasons on why people are unemployed. * Frictional Unemployment * Structural Unemployment * Classical or Real Wage Unemployment * Voluntary Unemployment * Demand Deficient or “Cyclical Unemployment” * Debate on Demand Deficient Unemployment Frictional unemployment occurs from the inevitable time delays in finding new employment. For example, if you graduated from college, you can’t necessarily...
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