The main causes of unemployment

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  • Created by: Lottie
  • Created on: 01-05-12 07:35

REAL WAGE UNEMPLOYMENT

  • form of dis-equilibrium unemployment that ocurs when real wages for jobs are forced above the market clearing level
  • traditionally trade unions & wage councils are seen as the instituions causing this type of unemplyment e..g. demanding higher wages

DEMAND DEFICIENT UNEMPLOYMENT

  • associated with an economic recession or a sharp economic slowdown
  • occurs due to a fall in the level of national output in the economy causing firms to lay off workers to reduce costs & protect profits
  • labour is derived demand thus this is the process of labour shedding
  • can also occur when economy is constantly  running below capacity

FRICTIONAL…

Comments

davidsalter

This is a good, brief summary on the causes of unemployment. Students can test their knowledge as well.

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