gcse economics - the big picture: unemployment - causes

• The reduction in demand for certain types of industries. These goods / services are no longer required in large numbers

e.g. 1980/ 90’s Deindustrialisation – coal mining, shipbuilding
2001 Airline industry

This is called STRUCTURAL unemployment

• People don’t have the right skills and qualifications for today’s work and the needs of businesses

e.g . Computer skills, communication, retailing STRUCTURAL

* Benefits are too high and too generous, therefore some people choose not to work.

e.g. an individual could collect £120 per week in different types of benefits
CLASSICAL

• Jobs are lost in the country due to a recession. This is an unfortunate part of the trade cycle where businesses may have to close down.

This is called CYCLICAL unemployment

* People may be between jobs. For example, a teacher may be unemployed because they are looking for a job as an accountant

This is called FRICTIONAL unemployment

• People may be out of work because of the seasons

This is called SEASONAL unemployment

ACTION

Which type of unemployment are the following examples?

a. Oscar Hammerhead loses his job due to a recession
b. Stevie Silk can’t be bothered to work because he can get £130 a week in benefits
c. Jackie Wilson loses her job because nobody wants video recorders any more
d. Sally Halfpenny resigns as a doctor to look for work as a teacher