Explain the persistence of high unemployment in Britain in the interwar years. Was unemployment in the period 1919-1939 voluntary?

The first 200 words of this essay...

Explain the persistence of high unemployment in Britain in the interwar years. Was unemployment in the period 1919-1939 'voluntary'?

Some argue that unemployment in Britain remained at a high level due to bargaining and institutional rigidities, the effects of long-term unemployment and the high turnover of the period. This essay will argue that most unemployment in this period was involuntary, and a result of demand shocks affecting the natural rate of unemployment, although it will reason that unions, long term unemployment and inefficient labour markets also played a role in maintaining British unemployment at a high level.

In 1921, British unemployment peaked both in terms of level and rate, with 2.212 million unemployed, representing an unemployment rate of 12.2%. After this, unemployment remained high until World War II, never falling below 1 million unemployed throughout the period. This persistence in unemployment was attributed by some, in part, to the high levels of unionisation in Britain at the time, and hence the existence of wage and institutional rigidities. In the interwar period, around to of the British labour force was covered by Union memberships, peaking at 44% of the labour force in 1920. Data suggests that union density in