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Is cyclical unemployment less of a risk for the UK?

Graham Watson

15th May 2024

Phillip Inman looks here at the latest labour market data and suggests that whereas unemployment is likely to rise in the months ahead, it seems as though we've moved into a new labour market paradigm when the degree to which unemployment fluctuates in line with the business cycle is much less marked.

Unemployment is now 4.3% and may reach 5%, as a result of falling spending, but it's a world away from the double digit unemployment of the 1980s and suggests that UK labour markets have become more flexible as a result of supply-side reforms.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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