Unemployment

N2012/Q.6
(b) Explain why unemployment which lasts for more than a year has more
harmful effects than
short-term unemployment for (i) the unemployed and (ii) the economy. [6]
(c) Discuss to what extent the aims of a low rate of inflation and a high rate of
employment are
likely to conflict. [8]

J2012/Q.6
(b) Distinguish between structural unemployment and demand-deficient (cyclical)
unemployment. [5]

N2010/Q.5
Most countries are faced with economic problems including unemployment and inflation.
(a) Describe what is meant by full employment. [3]
MS: Full employment exists when all those willing and able to work at a given wage are working.
In other words, all unemployment is voluntary. It is thus the level of employment at which all those who
wish to work have found jobs, with the exception of those who are frictionally employed.

Full employment is one of the main government macro-economic objectives (1).

Accept answers which refer to resources other than labour. [3]

(b) Explain the different types of unemployment that can exist in an economy. [6]

N2008/Q.6
(c) Describe two reasons why there might be changes in the level of unemployment in a
country. [4]
(d) Discuss why governments might be concerned to keep the rate of unemployment low. [6]
MS: Discussion of the reasons for the aim of low unemployment could, for example, include reference to
economic growth caused by higher employment; to the reduction in government payment of benefits that
occur if unemployment is reduced leaving more expenditure available for alternative programmes; to the
desire to raise incomes and standards of living; to the resulting increase in tax income the government
receives if employment increases. [6]
J2008/Q.5
(c) Why might a government wish to increase employment opportunities? [5]
(d) Discuss what might be the consequences of unemployment. [5]
MS: Discussion of the reasons for the aim of low unemployment could, for example, include reference to
economic growth caused by higher employment; to the reduction in government payment of benefits that
occur if unemployment is reduced leaving more expenditure available for alternative programmes; to the
desire to raise incomes and standards of living; to the resulting increase in tax income the government
receives if employment increases. [6]

J2007/Q.7
(c) Explain how different types of unemployment may be caused and consider which might be
the most serious. [10]
MS: Explanation of types of unemployment – regional, structural, frictional, cyclical, seasonal, voluntary,
7 marks.
Candidates should support their choice of the most serious with reasoned comment, 3 marks.
[10]

J2006/Q.4
Australia’s unemployment rate fell to 5.5% in May 2004, the lowest for 23 years. At the same
time total employment decreased to 9.6 million. Full-time jobs decreased by 42 600 but part-
time employment rose by 1500. The shift from employment in agriculture and manufacturing to
services has continued.
(a) Calculate the change in total employment. (Show your working). [2]
MS: 41 100 (1 mark), decrease (1 mark), (42 600 — 1500), working (1 mark), up to a maximum of 2
marks.

(b) Explain why the pattern of employment might change. [8]

MS: Preference for part-time employees, more flexibility, lower cost, fewer rights. Decline in agriculture
and manufacturing because of changed competitiveness, changing demand patterns, growth of services
because of rise in incomes, changing technology. Identification 4 marks; Explanation 4 marks.

(c) The above extract says that the unemployment rate fell yet the numbers employed
decreased. Explain how these statements can both be true at the same time. [3]
MS: Statement seems inconsistent because the unemployment rate fell to the lowest for 23 years but total
employment decreased. One is an absolute figure, the other is a proportion of the working population.
Working population could decrease but within that the % employed could increase.

(d) Discuss the economic consequences of unemployment. [7]

MS: Government will have to give extra support to unemployed in transfer payments, resources are
unused, and growth in the economy is restricted, social problems increase causing again extra expenditure
for the government, exports could decline. Knowledge of particular issues up to 4 marks, Discussion up to
2 marks per point.

N2004/Q.3
(b) Identify three types of unemployment and explain how they are caused. [6]