• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Assess the main causes of unemployment

Extracts from this document...


Assess the main causes of unemployment Unemployment is described as someone who has been in previous employment but he/she has lost their job due to various factors, which will be assessed within this essay. Unemployment is not to be confused with workless households - a workless household is one where all occupants choose not to work or physically can't work because of disability. Also, the occupants within a workless household would be receiving benefits, such as Income Support. Unemployment has risen very sharply over the past twenty years for two main reasons. Partly it is because of technological changes which have caused structural change in the economy and also because of the change in Government policies. Although structural changes and Government policies are primary factors which have caused unemployment, there are also secondary factors which have added to the rate of unemployment and these are age and education. Within this essay, all of the above factors and causes of unemployment such as structural change, Government policy, age and education will be assessed. One of the primary factors which has caused unemployment is structural change, this was when employment shifted between the three business sectors - primary industry, manufacturing and the service sector. ...read more.


In 1996, only 1% of people returning to the workplace were earning �251-260 per week and a large 7.2% were only earning �51-60 per week and 5% were only earning a very low �0-20 per week, showing that sometimes staying unemployed can mean a larger income gained from benefits compared to the low rate of wages which could be received in employment. In 1979, 1.7 million people living in workless households had below half the average income and by 1994/95 this had raised to 2.8 million; this is a massive increase in twenty-five years of 1.1 million people living with a low standard of living with many experiencing some form of poverty. Secondary factors which have lead to unemployment are such things as age and education. Even though secondary factors are easier to control, they still cause problems. Firstly, within the age group of 16-21 year olds, they are more likely to be unemployed, unqualified and untrained if they were school leavers at sixteen; also, if they are employed they are more likely to earn less because there is no minimum wage for sixteen and seventeen year olds. Within this age group of 16-21 year olds who were school leavers at the age of sixteen; the young men are more ...read more.


There is also the case of being over-qualified within today's workplace. An example of this is between 1979 and 1996 employment for those with a degree had decreased by 1%, however, those with a higher education's employment rate had risen by 3%. This is because some employers only employ people who can do the job well, they do not want to employ the people who have degrees and could do the job very well because then they would have to pay them more! Therefore, to assess the main causes of unemployment the primary factors of structural changes within the industries and the changes in Government policies were explored as they have caused a large increase in the rate of unemployment because of the closure of traditional industries and inflation rates rising. Also, the secondary factors of age and education add to the rate of unemployment mainly because of the lack of education within the young age groups and then the older age groups and also the idea of being over-qualified for a job. Lastly, the rate of unemployment has increased because the higher amount of people living within workless households these days and who can find it harder to find long-term employment or even any type of employment with a high enough wage to help increase their standard of living and stop them from living with poverty. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Macroeconomics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Macroeconomics essays

  1. Identify the causes of unemployment and suggest suitable remedies

    January figures for the: Claimant count: 951,300 (a rate of 3.2 per cent), a decrease of 10,600. Labour Force Survey: 1,546,000 3. There are two main and one fringe types of unemployment: cyclical, demand-deficient and Keynesian. There are two major categories that unemployment factors fall into: a)

  2. How have the Rates of Inflation in the UK Changed Since the Monetary Policy ...

    10% inflation, it will only be if there have been these levels of inflation in the past. This is why some economist argue that this can not be an initiating cause to the inflation. Cost-push inflation is another Keynesian version of inflation where it is shifts in aggregate supply, not aggregate demand, which cause the inflation.

  1. Budget 2004-05 and Economic Analysis of Pakistan

    ENVIRONMENT: Air pollution levels in Pakistan's most populated cities are among the highest in the world and climbing, causing serious health issues. The Government offered numerous incentives to private investors to invest in CNG over the last decade with the result that today Pakistan is the largest user of CNG in Asia.

  2. Greece financial crisis: The main causes of this crisis are? What are ...

    Foreign direct investment (FDI) inflows to Greece have dropped, and efforts to revive them have been only partially successful as a result of declining competitiveness and a high level of red tape and bureaucracy. At the same time, Greek investment in Southeast Europe has increased, leading to a net FDI outflow in some years.??

  1. Report on Austrlian Workplace Relations

    Australia needs this combination of a reliable wage system and skilled labour to be internationally competitive in regards to the level of production. Through industrial relations these characteristics are regulated through a number of laws and processes. Workplace relations incorporate all of these issues while attempting to solve other issues of employee and employer relations.

  2. What are the main differences between the 'natural rate of unemployment' and the 'NAIRU' ...

    full employment because the objective of a national union would be to maximize the expected income of each member of the labour force. 3. What is hysteresis? Hysteresis is a hypothesized property of unemployment rates that predicts that the equilibrium rate of unemployment is path-dependent, which means the natural unemployment

  1. Discuss the view that minimum wage legislation leads to unemployment. Has this been the ...

    The NMW may be artificially 'holding up' the natural level of unemployment. Employers can no longer pay workers cheap wages leaving more people unemployed and unable to occupy low-paid jobs. The higher wages also mean that employers need to make existing staff more productive through training and technology, further reducing the need for more labour.

  2. Governments set economic objectives - Discuss the relative importance of each of these objectives ...

    There are so many forms of market failure that the government must intervene in the market place, hence the use of interventionist policies. To increase economic growth, the government can increase public expenditure on education and training, through subsides for training and increasing the legal requirement of firms to undertake training with all 16 to 18 year old.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work