Professional Documents
Culture Documents
What is Unemployment?
unemployed labourforce
X 100
The labour force is the total of the employed and unemployed. So if 1 million people are unemployed and 9 million are employed, the unemployment rate is 1/10 x 100 = 10%
Not Employed
Want to work
10
12
14
Millions of people
U N 20 E M P 15 L % O 10 Y M E 5 N T
0
Great Depression
1982/83 recession
1990/91 recession
GFC
2000
2010
YEARS
A migrants English speaking ability (not well) 36%-12% (6 months to 18 months after arrival) People with no non school qualifications8% compared to 2.7% for those with a bachelor degree. The long term unemployed 19.0%
Cat No. 4430.0, 6287.0, 6250.0, 1301.0,DEEWR (HREOC) (immi.gov)
10
Some unemployment is inevitable as people change between jobs(frictional) or may not have the skills to match the jobs available. There are some that can be influenced. The main causes of short - run unemployment is a lack of aggregate demand. This is cyclical unemployment. There is not sufficient demand in the economy to employ all available workers. This is usually what happens in recessions and depressions. The aggregate demand curve has shifted to the left leading to reduced real GDP and higher unemployment.
11
AS 1
P R I C E L E V E L
500 400 300 200
AD 1
100 0 0 100 200 300
AD 2
12
13
14
AS 2 AS 1
AD 1
Real GDP
15
16
Participation rate
62
60
R A T E
58
Unemployment rate
56
1960
1970
1980
1990
YEARS
17
18
19
20
21
22
23