Unemployment Today

Unemployment Today

Introduction

This paper will focus on the topic relating to unemployment today in America. However, unemployment is when a person lacks (paid) work, but also measures of the proportion of the labor force (in an area) are inactive. In politics, the unemployment rate in a country is often one of the issues being debated most.

In some countries, there are different types of support for the unemployed. In Sweden called insurance unemployment benefits (unemployment benefits) and is means-tested.

Causes of Unemployment

The overall unemployment in United States can be divided into:

Cyclical unemployment - Cyclical unemployment due to the economic situation

Classical unemployment - Caused by governments or social partners set too high real wages and minimum wages

Frictional Unemployment - Depends on the time it takes to apply for jobs and learn about potential employers, while it takes time for employers to hire.

Structural unemployment - Caused by labor skills or geographical location does not match the demand for labor. This can occur, for example, by some industries disappear either by reducing overall demand or by the local jobs will be ousted.

Different views on what causes unemployment has varied through time and even today it is an issue are discussed in economics. The issue is complicated by the existence of different types of unemployment. It is customary to distinguish between frictional unemployment and structural unemployment. The former is not particularly harmful either for the unemployed or the economy as a whole. The latter is more serious because it is often assumed to be due to the mismatch between supply and demand of labor (Book, 2009).

One can distinguish three main reasons for unemployment: that wages are too high, the demand is too small and that the market is too sluggish to bring together supply and demand. The explanation that focuses on wage levels is often called the classic legend. To focus instead on the demand made such the English economist John Maynard Keynes. Keynes's views of unemployment have had a major influence in Sweden. The third explanation argues that frictional unemployment is actually more central than it is often considered. Therefore it is important to move from job to job or from unemployment to work is as smooth as possible. This reduces the amount hours in the community.

Some economists believe that there is a contradiction between the European welfare economies and low unemployment. The U.S. labor market has historically been less regulated and employment has been less safe for workers, Americans move generally more than Europeans, have less union activity and higher pay. This has all contributed to the U.S. labor market has been more flexible, at the expense of worse conditions for workers.

Some have even suggested that it is the new technology that reduces the need for human labor, thus increasing unemployment. This explanation, however, is generally rejected by economists (Book, 2009).

Deceptive Drop in Unemployment in America

Only at first glance, a slight drop in the U.S. unemployment rate is good news. Closer insight into the statistics can diagnose stagnation of the ...