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Revision on Labour Market Failure

Sunday, April 20, 2014

Revision resources on the topic of labour market failure

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Unit 1 Micro: AS Micro Revision Quiz 4

Wednesday, April 16, 2014

Here are twelve more questions covering markets and market failure - test your understanding with this zondle-powered quiz!

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Unit 1 Micro: Revision on Market Failure

Here are some revision quizzes for students to check their understanding of market failure

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Geographical mobility of labour in the UK

Saturday, March 22, 2014

One type of market failure that contributes to inequality and unemployment is the geographical immobility of labour

If the labour market really ‘cleared’ effectively, wages would equalise across the economy. Workers would drift away from regions with low wages and/or high unemployment towards areas where wages were higher and labour was scarce. 

Instead, we see wide disparities in earnings and pockets of regional unemployment - at the same time as skills shortages and wage inflation elsewhere.

Why are people finding it hard to move across the UK in search of work?

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UK Economy: Mind the Gap - Skills Shortages

Monday, March 17, 2014

Are skills shortages holding back the economic recovery? The Financial Times is running a video series looking at the problems businesses are having in recruiting people with technical skills. The apprenticeship programme is expanding but will it be enough to meet the growing gap between demand for and supply of engineers and other specialist jobs in industries surrounding precision engineering, nuclear power and many others? 

According to an article in the Financial Times:

"Migrants are filling a fifth of jobs in industries such as oil and gas extraction, aerospace manufacturing and computer, electronic and optical engineering because of a lack of skilled British graduates."

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Revision Planner For AQA Unit 1 - Markets And Market Failure

Monday, January 06, 2014

I put this together this morning, to help students understand where they need to revise for upcoming mocks, or for the real event in May. I hope some of you get some use out of it too.


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Unit 2 Macro: Nestle Creates Hundreds of Jobs for Younger Workers

Sunday, November 17, 2013

Long term youth unemployment is a persistent structural problem for the British economy - this BBC news article provides a ray of hope as Nestle announces extra investment in their training / apprenticeships schemes for younger workers. A more pro-active approach from larger businesses would be welcome - offering paid experience to help break the catch-22 of no job without experience, no experience without a job. Nearly one million young people (16-24) are unemployed in the UK, while youth unemployment in Ireland is 28 per cent with more than 65,000 young people out of work.

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Learn Maths, Young Person!  The Secret of Success in the 21st Century

Thursday, November 14, 2013

A currently fashionable pessimistic topic is the lifetime prospects of children born into the middle class. Graduate debt, lack of finance to buy homes and job insecurity after they graduate, the list goes on. Alan Milburn, the government’s ‘social mobility tsar’, put the seal of approval on this prevailing angst last month. His Social Mobility and Child Poverty Commission pronounced that children from families with above-average incomes are now set to enjoy a worse standard of living as adults than their mothers and fathers.

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HS2 Cost Benefit Analysis

Tuesday, September 24, 2013

There are lots of resources out there for students and teachers wanting to cover the debate about HS2 - here is a brief selection of video clips on the debate

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Unit 2 Macro: Portugal’s Brain Drain

Monday, September 09, 2013

With a deep recession and persistently high rates of unemployment among younger people. fears are growing about a brain drain in Portugal as highly qualified university graduates leave the country in search of a better life. Peter Wise, Financial Times Lisbon correspondent, reports on what the trend means for the troubled Portuguese economy. Losing "the best of a generation" poses important long-term threats to the competitiveness of the Portuguese economy. Some are moving to Angola and Brazil, the UK has also attracted skilled workers in health care, banking and IT.

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Unit 4: Introduction of Employment Tribunal fees as a supply-side policy

Monday, July 29, 2013

As of today, any employee wishing to take their employer to an unfair dismissal, unequal pay or sexual discrimination tribunal will have to pay a fee. This fee will not be automatically refunded on a successful tribunal outcome meaning that employees who are making choices about such an action have to be aware of the potential financial cost of such an action.

The government argue that this removes some of the burden of tribunal costs away from tax payers and should also reduce the number of frivolous claims made (and thus reduce a further burden on businesses). As such, you could claim that the tribunal fee represents a supply-side policy by the government - an attempt to improve the efficiency of the operation of businesses by reducing some of the red-tape that can stop a business working effectively (particularly small businesses).

Trade Unions are unhappy about the fee introduction. They argue that it reduces the opportunity for poorer workers (or unemployed people who have lost a job) to seek justice for what may have been unfair treatment. An evaluative argument here, therefore, might suggest that the tribunal fee acts as a barrier to fair pay, particularly in cases of discrimination.

Follow this link for some details as illustrated by the New Statesman.

Econ 3: Wage Determination and Equality

Monday, June 17, 2013

Here's a teaching resource suggested by one of our colleagues who attended the Wow Economics CPD event in Birmingham last week.  We were discussing a resource called the Average Wage game (available as an individual download from this website) which asks students to categorise occupations into those jobs with pay above the national average and those below the national average (as per the latest available statistics from the Office of National Statistics, November 2012).

One delegate suggested that they had used a similar resource which starts by asking students to rank occupations in an order which reflects their relative value to society (ignoring, initially, any notion of wages or pay).  Having ranked the occupations from the 'most' to the 'least' valuable, the teacher then shows the students the average wage paid to people working in those occupations and leads a discussion on how many of the most 'valued' occupations pay among the least wages.

This is a fantastic starter activity to initiate conversations about wage determination and equality of pay.  You may also find this as a good discussion point over the coming weeks when introducing some A2 concepts to AS students.

Click on this link to download the Tutor2u version of this resource developed directly from our delegate's suggestion.

The Wow Economics event has its last airing this Wednesday in London.  An all-new version of the resource-packed day will be advertised soon in time for the new academic year.

Unit 1 Micro: Occupational Mobility from Mines to ..... Mines

Wednesday, June 12, 2013

Miners made redundant from Maltby Colliery in Yorkshire many of whom with decades of experience faced years on the unemployment register when the mine closed earlier in 2013. But some have been thrown a lifeline with the rising demand for miners in the UK potash industry.

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Structural unemployment - a real problem that needs addressing NOW!

Sunday, June 02, 2013

Interesting article from the New York Times digging into perhaps the most worrying legacy of this Great Recession, the problem of hysteresis and structural unemployment. It looks at the causes and potential solutions as well as including some great images included below illustrating the concept.

"Unemployment is staying high despite the end of the recession because we are now in a historic transition. Because of automation, globalization, efficiency and other factors, we no longer need the share of people working that we have had in the past. With these trends moving in only one direction, it is clear that the job crisis is permanent and will not go away with better economic times."

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UK Economy Revision - Policies to Reduce Unemployment

Friday, May 03, 2013

Here is a streamed (and downloadable) presentation on policies to cut unemployment in the UK economy.

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Paul Ormerod: Whatever happened to all those miners?  Shocks and economic resilience

Thursday, April 18, 2013

Where have all the miners gone?  To judge by the rhetoric of the BBC and other Leftist media outlets, whole swathes of Britain lie devastated, plagued by rickets, unemployment and endemic poverty – nearly thirty years after the pit closures under Lady Thatcher!

The reality is different.  There is indeed a small number of local authority areas where employment has never really recovered from the closures in the 1980s.  But, equally, there are former mining areas which have prospered.  

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Unit 4 Macro: Unemployment in Europe (March 2013 Update)

Tuesday, April 02, 2013

The scale and depth of the unemployment crisis in Europe is confirmed by fresh figures released by Euro Stat. Unemployment in the Euro Zone was 12.0% in February 2013 and the jobless rate for the European Union as a whole was 10.9%. Last month there were 26.3 million people counted as out of work in the twenty-seven countries within the single market, 19 million of whom live in Euro Zone countries. In the last year alone, unemployment in the Euro Zone has jumped by over 1.7 million but this aggregate figure hides large country differences and persistent regional and local variations. Here is the contextual data to take into the exam:

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econoMAX - Who’s for a Living Wage?

Saturday, January 19, 2013

Robert Nutter explains that, over recent years, the fear that the minimum wage would cause increased unemployment has not materialised, although since the start of the current economic crisis employers have expressed some concerns that employment may be affected in low paid jobs. Another concern has been the belief that a national minimum wage is inappropriate for an economy where costs and labour market conditions vary significantly between regions. The national minimum wage may perhaps provide a living wage in North-East England but certainly not in London.

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Unit 1 Micro: Key Term Glossary - Markets and Market Failure

Wednesday, January 02, 2013

An updated glossary of key terms for the Unit 1 Economics paper

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Unit 1 Micro: Markets and Market Failure Concept Glossary

Monday, December 10, 2012

An A-Z glossary for the Unit 1 Micro course

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Workplace Discrimination

Friday, December 07, 2012

Employment Rate Employment Rate Unemployment Rate Unemployment Rate Inactivity Rate Inactivity Rate

White  76.6% 67.6% 8.3% 6.8% 16.4% 27.5%
Mixed or Multiple  64.3% 55.3% 15.7% 15.8% 23.7% 34.3%
Black 61.4% 55.6% 21.7% 17.7% 21.6% 32.4%
Indian  77.0% 60.6% 8.2% 11.1% 16.2% 31.9%
Pakistani/Bangladeshi 68.7% 28.9% 12.8% 20.5% 21.3% 63.6%
Chinese & Other 67.0% 51.8% 10.3% 10.6% 25.3% 42.1%
Ethnic Minority 68.2% 50.8% 13.2% 14.3% 21.5% 40.8%
All 75.6% 65.6% 8.9% 7.5% 17.0% 29.1%
Source:  Labour Force Survey 2011

If you have seen the news stories today showing how workplace discrimination towards ethnic minority women continues to cause the government concern, you may be interested to read the full report.   It is available from the Runnymede Trust (it requires registration but it is free) and has been written for the All Party Parliamentary Group on Race and Community.  There's a brief summary from the BBC, but the full report gives recommendations that you might like to present to students as possible government intervention strategies and get them to evaluate accordingly.  The table above gives you a flavour of the statistics that can be used to discuss inequality of income and wealth.

Nobel Winner address youth unemployment

Thursday, November 22, 2012

Youth unemployment is higher than adult unemployment even in normal economic times. But in recessions, especially in countries with rigid labour markets, young people typically stay unemployed for too long. In these circumstances, urgent policy action is needed to avoid long-term unemployment, which destroys talent and creates social problems.

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Waseela-e-Taleem in Pakistan - showing how education is an example of a merit good

Monday, November 12, 2012

I'm sure you don't have any problems convincing your students that education is a merit good/service.  Every so often, however, it may be difficult for young people in the UK, aspirational and aiming high, to see how their own learning impacts so positively upon the wider society.  Although we constantly debate the quality of education in the UK and strive to improve, many young people will take opportunities to access schools and colleges for granted - perhaps arguing about local differences and the cost of higher education but rarely about actual access to basic education.  With such relatively high levels of literacy and numeracy amongst British youngsters it is difficult for them to imagine a society where this is not the norm.  The Waseela-e-Taleem initiative in Pakistan, however, could prove a useful example of how government intervention into education is about more than just the structure of assessment and paying teachers - but a country's drive to improve access to basic education and shift its economic as well its political and sociological prospects.

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Unit 1 Micro: Scoop-It on Market Failure and Intervention

Sunday, November 11, 2012

Here is a terrific example from Matt Smith of how to use Scoop-It to curate lots of useful examples of market failures and associated interventions. Click here  for Matt's Scoop-It on Market Failure

National Stress Awareness Day

Wednesday, November 07, 2012

You may have been too busy to notice but today has been National Stress Awareness Day.  This comes just a few days after Ed Milliband's speech about the taboo of Mental Health and how it impacts upon people's lives.  If you haven't done so recently, do check out the World Health Organisation 's website which has lots of data on the prevalence of mental health issues around the world with the most startling facts being that 1 in 4 people around the world suffer from mental health issues at some point in their lifetime affecting as many as 450 million people.

And yet, when was the last time you used this as an example of labour market failure or poor economic performance?

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Unit 1 Micro: Tragedy of the Commons and Market Failure

Tuesday, November 06, 2012

The “tragedy of the commons” is a metaphor used to illustrate the potential conflict between individual self-interests of producers and consumers and the common or public good.

In the original version of the term, the example is used of a stock of common grazing land used by all livestock farmers in a small village. Each farmer keeps adding more livestock to graze on the Commons, because the marginal cost of doing so is zero. But because the commonly own resource is then over-used or over-exploited, the result is a depletion of the soil and a fall in the value of the resource for all users. The resource may become irretrievably damaged.

The cause of any tragedy of the commons is that when individuals use a public good, they do not bear the entire social cost of their actions. If each seeks to maximize individual benefit, he ignores the external costs borne by others.

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Unit 1 Micro: Market Failure Glossary

Monday, August 27, 2012

This blog provides a glossary of many key market failure terms

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Unit 2 Macro: Youth Unemployment and Startup Milk Rounds

Thursday, July 19, 2012

This Financial Times news video is excellent on issues surrounding high rates of youth unemployment. The number of 18- to 24-year-olds out of work for at least six months has risen by more than a third in the past year to 403,000.

Many thousands are struggling to find work and the lack of apprenticeship schemes and the high level of short term or vulnerable contract work makes it extremely tough to get into formal work. More and more students are looking to establish their own businesses as an alternative. The rapid expansion of student-led entrepreneurship societies based around colleges and universities is a welcome development. So too is the rise of “start-up” milk-rounds at many of the UK’s universities. Challenging times yes, but opportunities will always exist for enquiring minds with ideas to incubate and grow.

BBC News: Unemployment down to 2.6m but long-term jobless rises

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Unit 1 Micro: Revision Blogs on Markets and Intervention

Thursday, May 10, 2012

Here is a selection of a recent blog resources on topics that appear on the core Unit 1 Syllabus focusing on changing market prices and examples of interventions to address perceived market failures

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Unit 2 Macro: Skills Shortages Hold Back Recovery

Thursday, April 12, 2012

Here is a superb news report from Channel 4 news about the shortage of skilled workers in the North East of England (an area of high unemployment). Nissan this week announced a big new investment in car making at their ultra-high productivity plant in Washington, Tyne and Wear. But many of the manufacturers along Nissan’s supply chain are finding it tough to get enough skilled people coming througth to make realistic bid for the orders that will come from Nissa. Some businesses are having to turn down contracts because they dont have the extra workforce to cope with the higher volumes of businesses.

Skills shortages are restricting the growth of many small and medium sized businesses especially in manufacturing. Little wonder that Nissan is working very closely with Gateshead College to run an apprenticeship scheme - an example of external economies of scale in action.

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Blanchflower calls for more action to address youth jobless crisis

Wednesday, March 28, 2012

Youth Unemployment

Professor David Blanchflower didn’t pull his punches when he was a member of the Bank of England’s Monetary Policy Committee and he is making his mark once more with an attack on what he views as the Coalition government’s lacklustre approach to tackling youth unemployment. Blanchflower is reported in the Guardian as wanting zero national insurance contributions for employers who take on younger workers in depressed regions and localities. And he wants greater investment in vocational education in schools and colleges with the school-leaving age raised to 18.

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Unit 2 Macro: Seasonal and Structural Unemployment

Thursday, March 15, 2012

This news video from the BBC focuses on a man who has been out of work for over two years in the seaside town of Weston-super-mare a town dominated by tourist businesses where employment is highly seasonal. It provides a strong short case study in the problems of people who have been out of paid employment for a long time. Watch the piece here

Channel 4 news have a special section on the unemployment crisis in the UK economy. Follow this link for fresh teaching and studying resources on unemployment. Follow this link for the Channel 4 News Jobs Report

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Unit 2 Macro: The Economic Disaster of Youth Unemployment

Saturday, January 28, 2012

The official figures show that there are now more than one million young people counted as unemployed in the UK although the precise scale of the jobless crisis is difficult to measure accurately. Nonetheless, it represents a fundamental economic, social and political problem and one that policy makers must address.

In this video report from Al Jazeerah, Lawrence Lee visits Leeds to find a well qualified nineteen year old with good qualifications but who cannot afford to go to university and is finding it tough to win a place in the police force - his main ambition.

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Unit 1 Micro: Can the UK Computer Games Industry Grow

Tuesday, January 24, 2012

Britain is one of the world’s biggest exporters of creative products - from live TV shows and music to books, arts, architecture and films the economy has built up an enviable global reputation for excellence and a growing trade surplus to aid our balance of payments.

Computer games falls squarely into this category but, according to TIGA - the trade association representing the UK’s games industry - unless there is renewed government support, the future of this sector is at risk. TIGA claims that the British games industry is suffering a significant ‘brain drain’ as talented programmers and artists leave the country to work abroad.

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Unit 2 Macro: Living below the Breadline

Friday, January 20, 2012

This article on the appalling depth of workless households in Liverpool is a reminder of the multiple aspects of relative poverty and economic/social exclusion.

The causes of unemployment are complex - many are structural - but it is hard to draw much if any optimism from reading this article. By some estimates over one third of households in Liverpool have no one in work and second and third generation unemployment is not uncommon. This is a must article for students to read if they want a better awareness of the human cost of non-employment. Read: Below the breadline on Liverpool’s workless estates

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Unit 2 Macro: A Prezi on Unemployment Policies

Wednesday, November 16, 2011

After a hesitant start and some time spent getting to know the user interface, I am starting to use Prezi more widely as an alternative to other presentation software. I would be really keen to share ideas and collaborate on presentations with other colleagues so if you are interested in joining up please let me know. Here is an initial presentation I used this afternoon on unemployment policies - focusing on ten strategies to reduce unemployment. The aim is to stimulate discussion among students who can take apart the proposals and substitute their own.

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Unit 2 Macro: Video Clips on Unemployment

Sunday, November 06, 2011

I blogged last week about unemployment and made available some updated charts on unemployment for the UK and a range of other countries. Here are some short video news clips on aspects of unemployment that I have been using when teaching unemployment to AS and A2 groups. These clips provide a window on the human and social cost of high rates of unemployment and are especially useful in reinforcing the causes of unemployment and evaluation of policies likely to be most effective in bringing jobless rates down over time.

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Unit 2 Macro: Reducing Unemployment after a Recession

Monday, July 11, 2011

How quickly do people find new work after they have been made redundant and experienced a period of unemployment?

According to new research published in the May 2011 edition of the Economic Journal, only around one person in every ten unemployed in Britain finds fresh work within a month and nearly half of the extra unemployed created in the wake of an economic shock such as the fallout from the global financial crisis are still without a new job after six months.

If government economic policies and the labour market generally are failing to get people back into paid jobs the impact of a recession on unemployment rates can last for a substantial time period bringing with it increased economic and social costs.

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Structural Unemployment - The Last Cast

Wednesday, February 23, 2011

In the spring of 2010 the iron and steel making plant at Corus in Redcar in Cleveland was mothballed seemingly ending a 150-year-old industry on Teesside and bringing with it an enormous challenge to the local labour market. BBC Teesside has produced many resources on the plant closure that will make the issue of structural unemployment vivid for students who want to understand many of difficulties of getting people back into work who have skills specific to heavy manufacturing. Here is a link to three short film clips on the impact of the Corus closure

Revision: Consequences of Unemployment

Saturday, January 01, 2011

Persistently high unemployment create huge costs for individuals and for the economy as a whole. Some of these costs are difficult to value and measure, especially the longer-term social costs.

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Apprenticeships for a Silver Generation

Wednesday, October 06, 2010

The oldest contestant in the new (6th) series of The Apprentice is thirty one! But why should apprentices be concentrated only among those in the early stages of their careers?

The number of people aged fifty and over who are applying for and winning places on apprenticeship schemes has more than doubled in the last few years as this BBC news video explains. Apprenticeship programmes for older workers challenges our common preconceptions about their place in the labour market - and this is a good thing as the debate continues about how best to support and encourage people to stay in work during these challenging economic times. Lifelong learning is not merely a vaccuous slogan - it has a real meaning and is hugely important for the British economy in the years ahead.

This video reinforces the importance of human capital, the need for flexible skills to avoid structural unemployment. And it raises questions about who should and who can fund apprenticeship schemes and their longer-term economic and social benefits.

Hundreds of jobs lost as Bosch moves from Wales to Hungary

Friday, January 15, 2010

The Bosch Group - a privately owned German multinational manufacturing business has announced the closure of it’s car parts factory in south Wales with the loss of hundreds of jobs. With 900 jobs going at the factory itself, the final scale of extra unemployment will be significantly higher because of the negative multiplier effects for the local and regional economy.

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David Blanchflower on Unemployment Policies

Sunday, November 08, 2009

David Blanchflower writes in the new Autumn edition of the RSA’s Journal about the help needed to avert an unemployment time bomb especially for younger workers. This piece builds on his recent talk at the RSA. It is a superb article and has some powerful sections on the economic and social consequences of high rates of unemployment.

A Case Study in Labour Mobility - 50 Jobs in 50 Weeks

Thursday, October 15, 2009

Perhaps we should expect nothing less from an unemployed Economics graduate, heavily in debt who had become desperate in search of a fulfilling job. Californian Dan Seddiqui went from being homeless and unemployed to getting 50 different jobs in 50 different US states in just 50 weeks and his story is featured in today’s Daily Telegraph

“In just 50 weeks Dan tried everything from being a lobster catcher, a jazz conductor, a TV weatherman and even a Las Vegas wedding planner.” Naturally a book is on the way!

This article is perfect as a starter teaching resource when discussing occupational and geographical mobility of labour and the natural and structural barriers that prevent others doing something similar in their search for worthwhile work.


Life in the Middle - income distribution in the UK

Thursday, May 28, 2009

The TUC has published a report ‘Life in the Middle - The Untold Story of Britain’s Average Earners’ surveying ‘Middle Britain’ in particular, and income distribution across the population as a whole. They define Middle Britain as the fifth of the population (quintile) which earns within 10% of the median income of about £20,000 per year for households in the UK in 2006/7, the last year when full figures are available. The results make very interesting reading, and give some good up-to-date figures on income distribution for use in A2 microeconomics papers.

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Revision - Labour Market Failure (presentation)

Wednesday, May 27, 2009

Here is a revised streamed presentation on market failure in the labour market

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Corus Steel and the Multiplier Effect

Sunday, May 10, 2009

The giant steel plant at Redcar has dominated the industrial landscape on Teesside for decades. I last went round the site on a school Geography Field Trip in the spring of 2006 and, although it felt a bit like being landed back in the 1970s, there was no denying the scale of the operations and the commitment to quality in producing high-value precision steel.

This BBC article focuses on the economic and social consequences if the Redcar plant closes - it is excellent for students wanting to understanding a little more about structural unemployment and also the negative multiplier effects that come from heavy job losses in a local area. The danger is that the loss of jobs may be permanent and that the region will suffer from an irreversible loss of skills.

The article states that “So as well as the 2,000 Corus jobs at risk, there’s a supply chain equivalent to maybe 10,000 people spread around the region.”

More here

Q&A: Why is youth unemployment so high?

Tuesday, March 24, 2009

Youth unemployment rates are typically higher than for the rest of the working population. Nearly 4 people out of 10 who are unemployed are aged between 16 and 24. And as our chart shows over 100,000 young people have been out of work for over a year, a figure that has doubled since 2002 although it is much lower than it was when the UK economy was coming out of recession in the early 1990s.

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Retracing the Road to Wigan Pier

Sunday, March 01, 2009

Paul Mason, Newsnight’s Economics Editor embarks on a journey from London to Wigan and considers the impact that a recession that is officially only six months old is having on the labour market. I used this (7 minute) piece with my AS students this week and it proved to be an evocative video clip highlighting in particular the issues of youth unemployment, structural unemployment arising from the collapse of production and jobs in the industrial heartlands of the Black Country and the hidden aspects of the downturn among the legions of self-employed, in this case the 250,000+ mini car drivers working in the UK. Paul Mason writes about his experiences here.

A related story ..... recession (depression?) in Dublin has caused a huge rise in the number of people applying for and apparently getting licences to drive taxis in the capital. This report in the Telegraph says that Dublin now has 16,000 licensed taxis. New York, with a population 17 times as large, has 13,000…... a good example to use of how macroeconomic difficulties impacts directly on localised markets.


Apprenticeships, skills gaps, information failure and training opportunities

Sunday, January 25, 2009

Earlier this month the Prime Minister announced a £140m plan to create 35,000 additional apprenticeship places, of which 20,000 would be in the public sector (and 6,000 with McDonalds, making it the biggest apprenticeship provider in the UK). Lord Young, the minister responsible for apprenticeships in England, promised that those who won apprenticeships in the public sector would be able to complete their training, come what may. This article highlights the plight of a young man who has just lost his engineering workplace experience while studying with one of the largest private apprenticeship training firms in the South West of England.

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