Trends in the Past Ten Years Essay

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Explain the trends over the past ten years in the unemployment rate, the participation rate and wage outcomes with reference to specific industries and gender in the Australian economy. Since 2003 the Australian Labour market has seen unprecedented changes in both its unemployment rate, participation rate and wage outcomes. The changes have been caused by a number of events and advancements, namely the 2008 Global Financial Crisis (GFC) and the change in attitudes towards employment by employers and employees, to name a few. The greatest problem in the labour market in the past 10 years has been the high level of unemployment. Unemployment is defined as when a person is actively searching for unemployment but unable to find work and is used as a measure of health in the economy. This graph, dated from 2003 to 2013 shows an underlying trend in the unemployment rate. As the world moved towards an economic downturn, the Australian government took measures to ensure the GFC had minimal impact on the economy. The survival of the GFC was due to several factors, including: Demand for Australia’s rich resources, companies cutting back staff hours rather than making big job cuts, generous federal public finances before the crisis and Kevin Rudd’s stimulus packages kept the Unemployment rate below 6% throughout the whole GFC, and has maintained that since. There is one obvious trend in the graph though, contrary to Australia believing it had survived the worst of the GFC, there was still a backlash, Unemployment rose from 4% to above 5.5% in less than 2 years, from 2008 to 2010. The cause of this was a time lag, which is when a firm observes a downfall or upturn in the level of demand and accordingly decreases or increases their demand for labour. This is caused by the fact that firms tend to operate with excess capacity, this means they do not fully utilize their

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