Identify Explanations for Unemployment and Its Implications for Policy Development

2150 Words9 Pages
Identify the different explanations for unemployment and discuss the implications this has for policy development. This essay will identify the various reasons given by economists for unemployment and will also explain what they mean. This essay will discuss the different policies implemented by the various governments from 1960s Labour government, the 1980s Conservative government through to Labour government of the late 1990s and 2000 and will examine the effects their different policies have had on Britain. What is unemployment and what effects does it have on a person and the economy? A person is considered to be unemployed if they are without a job, want a job, have actively sought work in the last four weeks, and are able to start work within the next two weeks, or out of work, have found a job and are waiting to start it in the next two weeks. Having a job or being employed is beneficial for the individual and important for a country’s economy to function at its premium, labour market activity is an important part of people’s lives. Donovan and Halpern (2002) found that there is a positive relationship between people’s satisfaction with their job and their satisfaction with life overall and that unemployment can have a lasting negative impact on people’s well-being. (ONS Social Trends) Economists identify many different and various explanations for unemployment from structural unemployment, regional unemployment, classical unemployment, seasonal unemployment, frictional unemployment, voluntary unemployment to natural unemployment. In this next section we will examine the different explanations for unemployment in the UK and how the policies of the conservative and labour governments tried to address the issues they faced. Seasonal unemployment occurs when certain industries can only produce their goods or products at certain times of the year examples
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