Measuring Unemployment

This goes through what unemployment is, how it is measured, the different types of unemployment and how migration effects unemployment levels in the UK.

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  • Created on: 11-04-12 13:50
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Unit 2-Measuring Unemployment
What is unemployment?
Unemployment occurs when people are able and willing to work but cannot find jobs.
How is unemployment measured?
Method 1-The International Labour Organisation (ILO) measure:
The ONS carries out the Labour Force Survey which is a survey involving a range of employers and
about 60,000 people are asked about their employment status 4 times a year. This uses the ILO
definition of unemployment: all people of working age seeking paid employment and available for
work in the next two weeks.
° 60,000 people could be too small a sample size and may not be representative enough.
° It is a telephone interview so people may lie.
° It is time consuming and expensive.
° More inclusive than the Claimant Count measure.
° It's an international comparison of employment.
Method 2 ­ The Claimant Count measure:
The Claimant Count includes all those in receipt of unemployment-relates benefits, principally
job-seekers allowance.
° People may claim benefits even if they are employed.
° It cannot be used as an accurate measure of unemployment to compare other countries. This
is because not every country's government gives out unemployment benefits.
° Claimant Count is more exclusive than the ILO because it doesn't include 16 to 18 year olds.
° The government can change the rules effecting the criteria for claiming benefits so it may be
inaccurate if used to measure unemployment over time.
Types of Unemployment:
1. Frictional Unemployment: This occurs when workers are searching for a job. It takes time to
search and find a new job. This is a short-run problem.
2. Seasonal Unemployment: This occurs when people work during a certain part of the year and
are unemployed for the rest of the year e.g. agriculture.

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Structural Unemployment: This occurs when the economy goes through a structural change.
So workers become unemployed because they do not have the skills required to work in the
new sector. The government would have to re-train these people to give them new skills to
work in the new sector. Structural unemployment usually happens in areas where a
traditional sector is not running anymore, for example, mining is not needed as much as it
used to and some mines in Wales and Scotland have closed down.…read more


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