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8 types of unemployment

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8 types of unemployment

  1. 1. • • • • • • • • Frictional unemployment Structural unemployment Cyclical unemployment Search unemployment Regional unemployment Casual unemployment Technological unemployment Seasonal unemployment By Churchill Afodume
  2. 2. Frictional Unemployment  Frictional Unemployment is when a person does not have a job due the process of moving from one job to another. Furthermore, it could also be the time period which the worker is searching for job.  Many people suffer from frictional unemployment such as    University graduates who are searching for a job after graduating from university(depending on their grades) Actors/ theatre actors who are searching for role in a movie/theatre play Football players who have been released by their clubs and have been put in free agent transfer waiting for team to sign them. (Northampton town released Akinfenwa) Overall, Frictional unemployment happens when it takes the labour market time to match a worker up with a new job.
  3. 3. Structural Unemployment  Structural unemployment is when a person is unemployed because     there is a lack of demand for worker as the firms are looking for specific worker who has the specific skills they are looking for. Structural unemployment happens for several reasons such as: Changes in technology – Some workers are fired because they do not know how to use some new technology or they can’t adapt to it. Changes in tastes: If a product keep decreasing in demand then eventually the company which produces the product will go bankrupt and their workers will be unemployed. Overall, Structural unemployment is an unemployment caused by lack of skills.
  4. 4. Cyclical Unemployment  Cyclical Unemployment is when there is a greater availability of workers than there is of job vacancies.  Cyclical happens when there is lower demand for products due to the lack of consumer confidence, disinterest or reduction in the consumer spending due to less disposable income. This would make the firms cutting back their workforce in production and maybe using capital good instead. Therefore, there wouldn’t be enough jobs for the unemployed.  Cyclical unemployment is called cyclical because it is linked to the business cycle of the economy. Demand has fallen for the product and the price level has decreased. This has caused the firms to cut back on their workforce so less people are hired for jobs
  5. 5. Search Unemployment  Search unemployment is when a person is unemployed because they are still searching for a job which they desire rather than accepting the first job which was offered to them when they became unemployed.  Search unemployment is sometimes also known as Frictional Unemployment because they are both very similar. Search unemployment is the time period which are still searching for job which is the same as frictional unemployment.  Search unemployment similarly affects the same people as Frictional unemployment which can be students. Some disabled people also suffer from search unemployment because sometimes the job they are offered is not suitable for them so they turn down the offer.
  6. 6. Regional Unemployment  Regional Unemployment is simply structural unemployment occurring in a specific region of a country. For example, changes in the south wales coal mines have left many people unemployed in that region because most of the people living in that region worked in the coal miners. Information last updated in August 2013.
  7. 7. Casual Unemployment  Casual Unemployment is simply when people are able to work but they choose not to work because they have sufficient cash so there is no need for them to work. However, this causes some problems because they add to the unemployment figures which makes it higher in the economy  Some people who are contractors or self employed can choose when not to work or choose not to work at the end of their contract because they feel they have made sufficient cash.  For example, if someone won 10 million pounds from the national lottery then they could choose not to work even though they are able to work then this would make them casually unemployed.  In Australia, the unemployment rate is increasing very rapidly because many people are becoming casually unemployed.
  8. 8. Technological Unemployment  Technological Unemployment is when there is a lack of jobs or when people lose their jobs due technological changes. People are replaced by capital goods and machinery because sometimes it makes the job easier and also quicker.  Furthermore, it also makes the cost of labour and productivity less expensive which would make the firms earn more profit. This could potentially cause deflation because the prices would have fallen due to the increase of supply. Due to the change in technology, the productivity rate has increased but the employment rate is decreasing.
  9. 9. Seasonal Unemployment  Seasonal unemployment is a working agreement where the worker is employed for a certain part of the year ,however after that time of the year has passed then the worker is left unemployed.  Examples of people who suffer from seasonal unemployment are people who work with weather related jobs such as summer tourism jobs, beach lifeguards or snow related jobs in a certain region.  Furthermore, people who are also construction workers who only work when house building jobs are available. The diagram shows the seasonal unemployment rate in the UK and in the EU
  10. 10. Through my research and personal knowledge, I personally predict that in the future the rate of unemployment will increase in the UK because many people are becoming lazy and deciding to live on job seeker’s allowance and benefits instead of finding jobs and becoming more productive. Furthermore, technology is changing everyday and soon there will be machineries which could effectively replace many human jobs.
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