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Unemployment: reasons and main forms

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Ministry of education and science of Republic Kazakhstan

University of International Business

Management Department

TERM PAPER

THEME: Unemployment: reasons and main forms

prepared by: Kulusheva Anar 117 group

scientific Adviser: Tulegenov S. V.

Almaty, 2008

Plan:

Introduction

Chapter 1. All about Unemployment

1.1 What is unemployment?

1.2 How is unemployment measured?

1.3 Why are there always some people unemployed?

1.4 Working resources and its classification

Chapter 2. Unemployment in practical

2.1 Unemployment Insurance

2.2 Types of unemployment

2.3 Distribution of manpower

Conclusion

List of used literature

Introduction

Why I choose this theme?

We all are living in globalization epoch. So, slight changing in economy
some countries in the one side of earth, are prove a big influence for
economy all countries in the entire world.

Due to , that economy all world’s countries connected with each other
and measures undertaken by this countries about getting down this
problem must be coordination.

Nowadays mortgage crisis in USA influenced for many countries economy
and for Kazakhstan’s economy too. And afterwards of any economy crisis
is unemployment. Today this theme is very topical.

All countries need to find measure for saving economy in their country
from crisis and find method to limit quantity of unemployed, because
increase quantity of unemployed is aggravate crisis in all country’s
economical branches.

Losing a job can be the most distressing economic event in a person’s
life. Most people rely on their standard of living, and many people get
from their work not only income but also a sense of personal
accomplishment. A job loss means a lower living standard in the present,
anxiety about the future and reduced self-esteem. It is not surprising,
therefore, that politicians campaigning for office often speak about how
their proposed policies will help create jobs.

A country that saves and invests a high fraction of its income, for
instance, enjoys more rapid growth in its capital stock and its GDP than
similar country that saves and invests less. An even more obvious
determinant of a country’s standard of living is the amount of
unemployment it typically experiences. People who would like to work but
cannot find a job are not contributing to the economy’s production of
goods and services. Although some degree of unemployment is inevitable
in a complex economy with thousands of firms and millions of workers,
the amount of unemployment varies substantially over time and across
countries. When a country keeps its workers as fully employed as
possible, it achieves a higher level of GDP than it would if it left
many of its workers standing idle.

The problem of unemployment is usefully divided into two categories –
the long-run problem and the short-run problem. The economy’s natural
rate of unemployment refers to the amount of unemployment that the
economy normally experience.

Chapter 1. All about unemployment

What is unemployment?

The answer to this question may seem obvious: an unemployed person is
someone who does not have a job. But as economists we need to be precise
and careful in our definition of economic categories. If you are in
full-time education, for example, you do not have a full-time job in the
usual sense of the word – i.e. you are not in full-time paid employment.
And there is good reason: you are studying. Hence you are not available
for work. What if you were not a student but were suffering from some
long-term illness that meant that you were unfit for work. Again,
although you would not have a job, we would not say that you were
unemployed because you would not be available for work. From these two
examples, it seems clear that we need to qualify our original definition
of an unemployed person as ‘someone who does not have a job’ to ‘someone
who does not have a job and who is available for work’.

But we still need to be clear as to what we mean by ‘available for
work’. Suppose you were not in full-time employment and were looking for
a job and I offered you a job as my research assistant for 50 pence a
day. Would you take it? If we ignore for a moment the complication that
economic research is so interesting that it is its own reward, you would
probably not take the job because the wage rate offered is so low. At
another extreme, suppose you won so much money on the National Lottery
that you decided you would leave university and live off your winnings
for the rest of your life. Would you be unemployed? No, because you
would still be unavailable for work, no matter what wage rate you were
offered. Thus, being unemployed also depends upon whether you are
willing to work (whether you are ‘available for work’) at going wage
rates.

We are now in a position to give a more precise definition of what it
means to be unemployed: the number unemployed in an economy is the
number of people of working age who are able and available for work at
current wage rates and who do not have a job.

Normally, economists find it more convenient to speak of the
unemployment rate. This expresses the number unemployed as a percentage
of the labor force, which in turn can be defined as the total number of
people who could possibly be employed in the economy at any given point
in time. If you think about it, this must be equal to the total number
of people who are employed plus the total number of people who are
unemployed.

How Is unemployment Measured?

The claimant Count. One simple way is to count the number of people who,
on any given day, are claiming unemployment benefit payments from the
government – the so-called claimant count. Since a government agency is
paying out the benefits, it will be easy to gather data on the number of
claimants. The government also has a good idea of the total labour force
in employment, since it is receiving income tax payments from them.
Adding to this the number of unemployment benefit claimants is a measure
of the total labour force, and expressing the claimant count as a
proportion of the labour force is a measure of the unemployment rate.

Since the government already has all the data necessary to compute the
unemployment rate based on the claimant count, is it is relatively cheap
and easy to do. Unfortunately, there are a number of important drawbacks
with the claimant count method.

One obvious problem is that it is subject to changes in the rules the
government applies for eligibility to unemployment benefit. Suppose the
government gets tougher and changes the rules so that few people are now
entitled to unemployment benefit. The claimant count will go down and so
will the measured unemployment rate, even though there has been no
change in the number of people with or without work! The opposite would
happen if the government became more lenient and relaxed the rules so
that more people became eligible.

As it happens, governments do often change the rules on unemployment
benefit eligibility. In the UK, for example, there have been about 30
changes to the eligibility rules over the past 25 years, all but one of
which have reduced the claimant count and so reduced the measured
unemployment rate based on this measure. The following are examples of
categories of people who are excluded from the UK claimant count: people
over the age of 55 who are without a job; those on government training
programmes (largely school-leavers who have not find a job); anyone
looking for part-time work; and people who have left the workforce for a
while and now wish to return to employment (for example women who have
raised a family). Many – if not all – of the people in these categories
would be people who do not have a job, are of working age and are able
and available for work at current wage rates; yet they would be excluded
from measured unemployment in the UK using the claimant count method.

Labour Force Surveys. The second, and probably more reliable method of
measuring unemployment is through the use of surveys – in other words,
going out and asking people questions – based on an accepted definition
of unemployment. Questions then arise as to whom to speak to, how often
(since surveys use up resources and are costly) and what definition of
unemployment to use. Although the definition of unemployment that we
developed earlier seems reasonable enough, the term ’available for work
at current wage rates’ may be too loose for this purpose. In the UK and
many other countries, the government carries out Labour Force Surveys
based on the standardized definition of unemployment from the
International Labour Office, or ILO. The ILO definition of an unemployed
person is someone who is without a job and who is willing to start work
within the next two weeks and either has been looking for work within
the past four weeks or was waiting to start a job.

The Labour Force Survey is carried out quarterly in the UK and is based
on a sample of about 60,000 households. Based on the answer to survey
questions, the government places each adult (aged 16 and older) in each
surveyed household into one of three categories:

employed

unemployed

not in the labour force (or ’economically inactive’).

A person is considered employed if he or she spent some of the previous
week working at a paid job. A person is unemployed if he or she fits
the ILO definition of an unemployed person. A person who fits neither of
the first two categories, such as a full-time student, homemaker or
retiree, is not in the labour force (or, to use ILO terminology,
economically inactive). Figure 1 shows this breakdown for the UK in the
autumn of 2004.

Once the government has placed all the individuals covered by the survey
in a category, it computes various statistics to summarize the state of
the labour market. The labour force is defined as the sum of the
employed and the unemployed:

Labour force = Number of employed + Number of unemployed

Then the unemployment rate can be measured as the percentage of the
labour force that is unemployed:

Unemployment rate = (Number of unemployed/Labour force) х 100

The government computes unemployment rates for the entire adult
population and for more narrowly defined groups – men, women, youths and
so on.

The same survey results are used to produce data on labour force
participation. The labour force participation rate measures the
percentage of the total adult population of the country that is in the
labour force:

Labour force participation rate = (Labour force/Adult population) х 100

This statistic tells us the fraction of the population that has chosen
to participate in the labour market. The labour force participation
rate, like the unemployment rate, is computed both for the entire adult
population and for more specific groups.

х 100 = 4.7 per cent

Because the adult population (the number of people aged 16 and over) was
47.4 million, the labour force participation rate was:

Labour force participation rate = (29.8/47.4) х 100 = 62.9 per cent

Hence, in autumn 2004, nearly two-thirds of the UK adult population were
participating in the labor market, and 4.7 per cent of those labour
market participants were without work.

Figure 2 shows some statistics on UK unemployment for various groups
within the population, broken down by ethnicity and sex, also collected
by the ONS. A number of points are worth noting. First – and perhaps
most striking – unemployment rates for people from non-white ethnic
groups were higher than those for white people, for both men and women.
Secondly, unemployment rates among ethnic groups vary widely. In
2001-02, among men, Bangladeshis had a highest unemployment rate in the
UK at 20 per cent – four times that for white British men. The
unemployment rate among Indian men was only slightly higher than that
for white British men, 7 per cent compared with 5 per cent. Unemployment
rates for all other non-white men were between two and three times
higher than those for white British men.

The picture for women was similar to that for men, although the levels
of unemployment were generally lower. Bangladeshi women had the highest
unemployment rate of all at 24 per cent, six times greater than that for
white British women (4 per cent). The rate for Indian women was slightly
higher than for white women at 7 per cent.

Data on the labour market also allow economists and policymakers to
monitor changes in the economy over time. Figure 3 shows the
unemployment rate in the UK since 1971, calculated using the claimant
count. Claimant count figures are less reliable than the Labour Force
Survey figures.

Nevertheless, the figure is useful in demonstrating that the economy
always has some unemployment and that the amount changes – often
considerably – from year to year.

Why Are There Always some people Unemployed?

The unemployment reasons. In the western economic literature of the
reason of unemployment are investigated mainly on the basis of purely
economic approach. Thus unemployment is considered as a macroeconomic
problem of not enough full use of a cumulative labour. Often reasons of
unemployment speak imbalance of a labour market or adverse changes this
market.

The most known theory explaining the reasons of unemployment, the theory
of J is. M. Keynes which has replaced in the mid-thirties the theory of
classics-economists (A. Smit, A. Marshall), explaining the unemployment
reason high level of wages. On Keynes, unemployment is inverse function
of cumulative demand. « Employment volume, – Keynes wrote, – by
absolutely certain image is connected with volume of effective demand ».
The insufficient volume of effective demand causes slackness of
investment process and, hence, impossibility of maintenance of
employment that conducts to I grow unemployment. An exit from this
situation Keynes saw in increase of a role of the state in formation of
cumulative demand at the expense of increase in the State expenditure,
first of all – on the investment goods. Keynes’s critics,
representatives of neoclassical school, see the unemployment reasons
just in that state policy which the developed countries spent« under
recipes» Keynes. So, for example, F. Hajek considered that unemployment
« is direct result of a short-sighted full employment policy which you
spent to a current of last twenty five years ». Growth of the State
expenditure, on F. Hajeka’s opinions, inevitably conducts to inflation
which, having reached a critical point, itself becomes the reason of the
increased unemployment. An exit from this closed circle one – to stop an
inflationary full employment policy. Certainly, at the first stage it
will lead to sharp jump of unemployment, but it, on Hayek’s idea, will
give the chance to reveal all defects in work placing, to develop and
carry out not inflationary methods the program of maintenance of a high
and stable occupation level. Monetarists led by M. Fridmenom have put
forward the concept of “natural” unemployment. To which they carry
so-called frictional unemployment. Frictional unemployment covers the
workers changing for those or other reasons a place of work, for
example, in search of higher earnings or work with большей by
prestigious ness, more favorable working conditions, or migrating in
connection with necessity of change of a residence. To natural
unemployment carry also structural, caused by changes in structure of
public manufacture under the influence of scientific and technical
progress and perfection of the organization of productions. This type of
unemployment also is time (though also more long, than frictional
unemployment) as disappearances of one manufactures (branches) it is
accompanied by rapid growth of others. Problem only in that, how fast
the unemployed can adapt to the changed conditions on a labour market.
The concept of “natural unemployment» is supported by almost all
economists, including Neokeynesians. Disputes go only that causes growth
of unemployment above natural level, – insufficiency of an aggregate
demand or the regulating policy of the state infringing the “natural”
mechanism of formation of employment and a wages in the market of work.
Thus, the western economists recognize that unemployment – the integral
attribute of market system of an economy, it is inevitable, and in the
“natural” variant even is useful to maintenance of necessary flexibility
of a labour market. But till now not one economic doctrine is not
indisputable from a point of sight of an explanation of the reasons of
unemployment and employment. All present sights at the unemployment
reasons can be grouped in the next image.

First, rather redundant population, “superfluous” in comparison with the
reached level of national production can become the unemployment reason.
This factor of unemployment especially hardly affects in the developing
countries.

Secondly, unemployment can be result of changes in economy structure,
including – in technologies (structural unemployment). This unemployment
is time as on change to old branches and productions (technologies) the
new come.

Thirdly, unemployment can was temporary to increase because of natural
desires of people to find work “to liking” and with the best working
conditions and payments (frictional unemployment). Fourthly, especially
strong increase in a rate of unemployment results from cyclic recession
in economy (cyclical unemployment). This kind of unemployment is the
most dangerous as there is a vicious circle: Production falling –
unemployment – reduction of the general level of incomes – aggregate
demand decrease – production falling – unemployment etc. Fifthly, in
certain cases the unemployment generator can become active interference
of the state and trade unions in relations between the hired worker and
the employer that leads to market inflexibility of wages and forces
businessmen to solve a problem of achievement of the maximum profit by
employment reduction. All these reasons of unemployment represent
without delay the factors influencing for the size and dynamics of
unemployment. The basic sources of unemployment are not market
proportions and the conditions developing on a labour market since a
labour market only reflects proportions existing at present between
demand and the labour offer, but direct sharing in their formation does
not accept. These proportions depend on the processes which are outside
of the market of work. The market only finds out them, shows
unemployment, and does its visible for company.

Working resources and its classification

Statistics of manpower. Manpower is persons of both sexes who
potentially could participate in production of the goods and services.
They are significant in the conditions of market economy as integrate
such categories, as the economically active population including of
taken both unemployed persons, and economically inactive population at
able-bodied age. Number of manpower is advanced proceeding from number
of able-bodied population at able-bodied age and working persons outside
of able-bodied age. The person of work possesses a main role in economic
activities development, perfection of its organization and management
for the purpose receptions of the greatest return from the creative
work. People invent and make instruments of labour and production
assets, will organise rational division and labour co-operation at
various levels of productive activity, beginning from a job and
finishing the organization within the limits of all national economy.
The labour as set of physical and spiritual abilities of the person is
main productive force of company and constitutes manpower of all
enterprises and the establishments belonging to various branches of a
national economy. Manpower of each made unit is represented by a part
distributed on branches of a national economy of manpower. The
statistical characteristic of availability of a manpower of the
enterprise, establishment, association, an industry, agriculture,
building or transport separately or all economic complex, is the list
volume of employment in them workers. The statistics of each branch of a
national economy studies the following questions connected with
application of a living labour:

1. Statistics of manpower and their use.

2. Statistics of labour efficiency.

3. Statistics of wages.

The statistics of manpower is divided in turn on two parts:

1. To the statistican of a labour – the primary goals is studying of
number and structure of workers, studying of change of number of
workers; an estimation of security of the enterprise a manpower;
studying of job management and use of workers on corresponding
qualification; labour discipline studying.

2. To the statistican of working hours – problems is definition of a
combined value of fulfilled time; studying of use of working hours, and
revealing of losses of working hours

Statistics of structure of manpower. In force of distinction manpower
the structure of workers at the enterprise is studied in following
directions:

1) on a branch accessory;

2) on work plots;

3) on the functions executed in the course of production.

Depending on a branch accessory of division of the enterprises the staff
of primary activity or industrial and production staff and staff of the
nonindustrial organizations allocate. On executed functions workers of
industrial and production staff are subdivided into six categories:
workers, pupils, engineering employees, employees, junior attendants and
workers of protection. The most numerous and basic part of structure of
workers are workers. To workers, directly linked with production, and
also the persons taken by repair and care by the equipment, material
delivery persons concern jobs etc. The persons trained on production of
this or that trade of workers and receiving wages concern pupils.
Engineering employees constitute that part of the enterprise which carry
out the organisation and a management industrial and engineering
procedure. The workers performing administrative and managerial and
economic functions concern employees. To junior attendants carry the
workers dealing with service of industrial and non-productive premises.
Depending on a role in the course of production discriminate the basic
and auxiliary workers. To the cores carry the workers, directly taken by
production manufacturing, leading to action machinery and plant. The
workers taken by service of the basic workers concern the auxiliary, the
equipment, on automation of their work. Working the basic and auxiliary
are in turn characterised by degree of mechanisation and automation of
their work.

The major statistics of number of workers of the enterprise is the size
of average list number of workers. Average list number of workers of the
enterprise or the shop, accepted for the partial working day, is
estimated so: total number of the man-hours fulfilled by these workers
for month, is divided into the established duration of the working day
and the number of the fulfilled man-days received thus, divide into
number of the working days in a month on a calendar.

For example, for a month in which on a calendar 22 working days, are
fulfilled by workers of 12500 man-hours. Then at five-day working week
the number of the fulfilled man-days will constitute 1524, as private
from division 12500 on 8,2; т.е.12500:8,2. Average list number of the
workers accepted for the partial working day (1524:22=69 the people)
Will constitute 69 persons. Thus, average list number of the workers
accepted for partial working week, advance as the relation of the
man-days fulfilled by these Workers to number of the working days in the
taken away month on a calendar. And the average list number of workers
working full-time is calculated as average arithmetic simple during a
certain interval of time (month, quarter, year). We will assume that for
the first half of the year average list number of industrial and
production staff has constituted 730 persons, and for July – 710, August
700. Average list number of industrial and production staff for January
– August (8 months) Will equal: (736х6+710х1+700х1):8=5826:8=728 the
economic statistics gives the Basic attention to that part of a manpower
which participates in social work. Not less important problem there is a
definition of the taken workers on national economy branch. Two groups
of a manpower are allocated: taken by physical work and taken by
intellectual labour.

Despite the fact that what the labour productivity level increased all
over the world over the last 10 years, there are big ruptures in the
data on industrial and to developing countries. Though the states of
Southern and East Asia, and also the Central and Southeast Europe
already catch up with EU and the USA on this indicator, as a whole the
situation looks not in the best way. A poverty principal cause in the
world the International job management (SQUANDERER) named inefficient
use of a potential production of workers.

From the report containing key indicators of a labour market, published
on September, 2nd the SQUANDERER it is visible that the USA still is the
leader on productivity on one worker following the results of 2006. It
is necessary to note essential growth of this indicator for the past of
10 years in East Asia where productivity has increased in 2 times.

Furthermore rupture in productivity between the USA where an added value
on one worker (the highest in the world) has constituted $63,885, and
other developed economy following States continues to increase: Ireland
($55,986), Luxembourg ($55,641), Belgium ($55,235), France ($54,609).

However Americans work more hours per year, than citizens of other
developed countries. If to look at the cost added to one workers in an
hour the best labour efficiency in Norway ($37,99), it follow the USA
($35,63) and France ($35,08).

The labour efficiency increase generally grows out more of an effective
utilisation of a combination (combination) of work, the capital and
technology. Insufficient investments in human and a fixed capital along
with application of old technologies can lead to partial use of labour
potential in the world. «Huge rupture between productivity and riches is
at the bottom for anxiety, — the general director SQUANDERER Juan
Somavija has declared. — the Increase in labour efficiency of workers
with low yields in the poor countries leads to reduction of essential
deficiency of a labour in the world».

In East Asia where the highest growth of a performance level is
recorded, the output having on one worker, has grown with 1/8 to 1/5
from level of the industrial countries. In the report it is said also
that in South East Asia and in Oceania this indicator in 7, and in
Southern Asia in 8 times more low in comparison with the developed
states. In Central Asia, Latin and Central America the added value
having on one worker, in 3 times is less, than in the EU countries and
the USA, and in the countries of the Central and Southeast Europe, in
the CIS this indicator in 3,5 times more low. The biggest rupture in
comparison with the states with industrial economy is observed in the
Central Africa where the performance level in 12 times is less.

Thus, the next publication «Key indicators of a labour market» gives
wider submission that in the SQUANDERER name «comprehensible deficiency
of jobs» in the world. « Worthy »work ensures necessary productivity to
the employer who in turn supports safety precautions, grants fair
payment and social protection by worker and to their families, thereby
promoting a normal life of company.

Hundred millions men and women work, applying all forces, however
conditions in which they work, do not allow them to ensure own families
to the most necessary. People continue to live below the poverty line,
every day falling all below this line. The general director the
SQUANDERER Mr. Somavija has declared necessity of increase in labour
efficiency for the poor countries that would help people to earn more.

By data the SQUANDERER of 1,5 billion people in the world — or third of
able-bodied population — not completely use the working potential. The
problem consists that people in the poor countries want, but has no
possibility to work. The income on one member of the family there does
not exceed $2, it is catastrophically low figure. More than half of all
taken are subject to threat to remain below the breadline. The majority
of such people works in shadow economy and does not get practically
under any protection. In the Central Africa and Southern Asia of 70 %
taken are in similar position.

Besides, in the report the situation which has developed on labour
markets is reflected. So, about half of able-bodied population all over
the world does not leave on labour markets of the countries. Over the
last 10 years the passive behavior on labour markets was more often
fixed at women, rather than at men. Only 2 from 10 men do not show any
activity while at women such position meets in half of cases.

«Key indicators of a labour market» into which have entered 20 various
indicators reflecting a situation which have developed on a labour
market with its productivity, working conditions, wages and
indemnifications, represent a real picture of that as a whole occurs to
a labour in the world.

Chapter 2. Unemployment in practical

Unemployment Insurance

One government policy that increases the amount of frictional
unemployment, without intending to do so, is unemployment insurance (or,
as it is called in the UK, national insurance). This policy is designed
to offer workers partial protection against job loss. The unemployed who
quit their job, were fired for just cause or who have just entered the
labour force and not eligible. Benefits are paid only to the unemployed
who were laid off because their previous employers no longer needed
their skills.

While unemployed insurance reduces the hardship of unemployment, it also
increases the amount of unemployment. The explanation is based on one of
the Ten Principles of Economics. Because unemployment benefits stop when
a worker takes a new job, the unemployed devote less effort to job
search and are more likely to tern down unattractive job offers. In
addition, because unemployment insurance makes unemployment less
onerous, workers are less likely to seek guarantees of job security when
they negotiate with employers over the terms of employment.

Many studies by labour economists have examined the incentive effects of
unemployment insurance. In one US study, when unemployed workers applied
to collect unemployment insurance benefits, some of them were randomly
selected and offered each a $500 bonus if they found new jobs within 11
weeks. This group was then compared to a control group not offered the
incentive. The average spell of unemployment for the group offered the
bonus was 7 per cent shorter than the average spell for the control
group. This experiment shows that the design of the unemployment
insurance system influences the effort that the unemployed devote to job
search.

Several other studies examined search effort by following a group of
workers over time. Unemployment insurance benefits, rather than lasting
forever, usually run out after six month or a year. These studies found
that when the unemployed become ineligible for benefits, the probability
of their finding a new job rises markedly. Thus, receiving unemployment
insurance benefits does reduce the search effort of the unemployed.

Even though unemployment insurance reduces search effort and raises
unemployment, we should not necessarily conclude that the policy is a
bad one. The policy does achieve its primary goal of reducing the income
uncertainty that workers face. In addition, when workers turn down
unattractive job offers, they have the opportunity to look for jobs that
better suit their tastes and skills. Some economists have argued that
unemployment insurance improves the ability of the economy to match each
worker with the most appropriate job.

The study of unemployment insurance shows that the unemployment rate is
an imperfect measure of a nation’s overall level of economic well-being.
Most economists agree that eliminating unemployment insurance would
reduce the amount of unemployment in the economy well-being would be
enhanced or diminished by this change in policy.

Types of unemployment

There are various kinds of unemployment, each of which is generated by
the reasons. Today economists prefer to speak not about unemployment in
general, and to allocate its specific kinds:

frictional

structural

cyclic

seasonal

voluntary

Frictional unemployment exists even in the countries enduring rough
economic blossoming. Its reason consists that to the worker who
dismissed from the enterprise or has left it of the own free will, some
time to find a new workplace is required. It should suit it both by the
nature of activity, and on payment level. Even if in the work market
such places to eat, find them it is possible usually not at once. One
people feel capable to perform more difficult and highly paid work and
search for it, others are convinced that do not correspond to
requirements of the workplace and should look for work with payment more
low. In a free market society always there is a certain quantity of
people which for various reasons search for itself for more suitable
work Besides, on a labour market always there are unemployed who search
for work for the first time (youth, the women who have grown up
children, etc.). Such people also are considered at definition of level
of frictional unemployment. These processes promote increase of
efficiency of use of labour resources, their more rational distribution.
The economic science considers frictional unemployment as the phenomenon
normal and not causing alarm. Moreover frictional unemployment is simply
inevitable in normally organised economy. Growth of frictional
unemployment can cause a number of the reasons:

1) lack of information of people on possibility to find work on the
speciality and with arranging level of payment in concrete firms;

2) the factors objectively reducing mobility of a labour. For example,
the person has not found work in the city, but cannot move in other city
where such work is, because of backwardness of the market of habitation
or absence of a residence permit. Such situation is characteristic for
Russia that is unprofitable distinguishes a domestic labour market from
a labour market of the western countries.

3) Features of national character and a way of life. Frictional
unemployment above in those countries which citizens prefer to live all
life in the same settlement, that is differ the lowered mobility. At
such way of life (characteristic and for many Russians) labour overflows
between regions are reduced.

Structural unemployment. The manufacture structure cannot remain
invariable. As a result of scientific and technical progress,
technological changes, the labour demand structure varies also. The
requirement for one kinds of trades is reduced, and other specialities
disappear at all. But there is a demand for new trades. Earlier not
existing. Such unemployment already where is more painful for people,
than frictional.

Occurrence of structural unemployment means that many people should
master new trades, to avoid structural unemployment it is impossible. It
is connected by that technical progress all time gives rise to the new
goods, technologies and even the whole branches (manufacture of personal
computers, laser disks and fiber optics, for example, concerns them). As
a result the labour demand structure strongly varies. And people with
trades unnecessary more in former quantity appear out of work,
recruiting of ranks of the unemployed. For example, import to Russia
considerable number of personal computers has led to refusal of use of
the big COMPUTERS which service needed a considerable quantity of
programmers. Together with computers new “generation” of the software
products, allowing to communicate with car without the intermediary –
the programmer from abroad has come. To keep or get a job, programmers
of old school had to be retrained, seize urgently modern languages of
programming and new software packages. Changes in demand structure
appear today more and more essential. The American experts, making the
forecast of development of a labour market in the USA till the end of a
century, have found out inevitability of serious changes on it. It has
appeared that to 2000г. The number of farmers in the country will be
reduced to 900 thousand persons, and the share occupied in the industry
will fall from 18 % in 1990г. To 9,7 % to the XXI-st century beginning.
The overwhelming part of hired workers will work in any branches of
services, including 43 % – in computer science sphere. The number of
workplaces for the people owning following specialties will fastest
grow:

1) the bookkeeper or the auditor

2) the mechanical engineer

3) the staff nurse

4) the expert in communications of the companies with the public

5) the programmer for personal computers and the computer techniques

6) the therapist specializing on occupational diseases

7) technician on service of medical equipment.

Structural unemployment, at all morbidity, also can not excite the
country, but only in the event that total number of empty seats does not
concede to number of the people searching for work, though and having
other specialities. If in general it is less than workplaces, it means.
That in the country there was a third, most unpleasant form of
unemployment – cyclic.

Cyclic unemployment is inherent in the countries enduring the general
economic recession. In this case the crisis phenomena arise not on
separate, and practically in all commodity markets. Difficulties are
endured by the majority of firms of the country that is why mass
lay-offs begin almost simultaneously and everywhere. As a result total
number of free workplaces in the country appears less numbers of the
unemployed. In revival and lifting phases there are new working places,
and unemployment resolves. Sometimes to a category of the unemployed
carry (though and it is not quite lawful) seasonal workers. They remain
without work of that some kinds of activity can be carried out only
during the certain periods of year. The most typical example is the
agricultural workers occupied during the period of harvesting, and in
the rest of the time interrupted casual earnings.

институциональными changes. The today’s information on the unemployment
scales, given by Goskomstat, underestimates an original rate of
unemployment approximately in 5 times that creates additional alarm and
without that to astable economy of Russia. But level understating, in
the majority cases, occurs because of discrepancies in the course of
gathering of the information on the unemployed.

The international organization of work (SQUANDERER) had been developed a
technique reducing to a minimum of such discrepancy. It consists in the
following: data gathering on the basis of monthly interrogations, about
50 thousand casually chosen family economies is made. Questions concern
following problems: whether that or other individual had work last week;
whether he tried to find work; what is the time it has already spent for
employment; it undertook what actions with that end in view. Proceeding
their answers to questions, to the unemployed carrying persons is more
senior 16 years, which during the considered period: had no work
(profitable employment); were engaged active in work searches; were
ready to start to work. Not occupied in a social production and not
aspiring to get a job persons do not consider at definition of a number
of labour (that is economically active population). Many people from
this category can work, but do not do it owing to those or other
reasons. They are students of day branches, pensioners, housewives.
Children aged till 16 years and the prisoners enduring punishment in
prison are automatically excluded from a category of economically active
population. The special category is represented by military men. The
number of the persons consisting on the valid military service, is
included into size of a cumulative labour, and at definition of the
number of labour occupied in civil sector of economy, this category of
economically active population is not considered. That affects in
calculation of the general norm of unemployment and norm of unemployment
for civil sector. These indicators reflect relative density the
unemployed in number of a cumulative labour and a number of labour of
the given sector accordingly.

безработного and taken essentially differ from concepts” working “and”
idle “. On the one hand, many working do not get in category taken, for
example, housewives. They are considered as taken only when they receive
for the work monetary compensation. Besides, the number occupied does
not join working children till 16 years irrespective of, whether they
receive wages for work or work free of charge. On the other hand, at all
each “idle” gets in a category the unemployed. It is possible to carry
many people who are not doing anything to them to find to itself new
work. Those who are absent during the given moment on a job because of
illness or bad weather, and also so named “partially taken” (working
incomplete the working days etc. are not considered as the unemployed).

“Unemployed” and “incapable to find work”. These similar concepts
actually also are only approximate. For example, the people temporarily
dismissed from a place of service, and also the works which have found a
place get to number of the
unemp??????????????????????????????????????????????????????????•????????
??????????????????????????????????????????

g

I?

–——E?o?“c?c?cac$FiF FIF?Y??‹?x»Ae1/2

?Љ?Manpower – a part of the population of the country, having physical
development, mental faculties and the knowledge necessary for employment
by socially useful work. The sizes of manpower depend on a population, a
mode of its reproduction, structure on a floor and age. The basic part
of manpower of the country is constituted by its population at
able-bodied age, and also teenagers and persons of the pension age,
capable to work Allocate still other category – the people really
participating in production of goods or non-productive sphere, –
economically active population. It is important to consider and a parity
between an able-bodied part of the population, on the one hand, and idle
(children and old men) – with other. It name demographic load. On the
average in the world of 100 able-bodied people ensure the earnings of 70
children and pensioners. In developing countries such indicator
frequently constitutes 100 on 100, whereas in Japan – 100 on 41. In
Russia, Belarus, in Ukraine, in the Baltic States demographic load is
approximately equal world average.

The crisis which has begun as bank, by degrees gets into all spheres of
economy. Experts of the personnel market notice that the first wave of
reductions has already begun. First of all, send in no-charge holidays
so-called support staff, differently – the experts attending very
wasteful for companies at present to projects with the delayed date
received of profit. Reduction cost cutting also has begun, many projects
were freezed.

Conclusion

незанятость and an active search of work irrespective of the
registration fact (on methodology the SQUANDERER); absence of work,
irrespective of availability of the official status of employment (in
case of holidays and the partial working day at the initiative of the
employer).

Obviously, the more operative and short-term character is carried by
this or that problem of employment, the above probability of use of
direct administrative influence. Main strategic targets of regulation of
employment should be increase of economic and social efficiency of
employment at the expense of change of its structure, forms, creation of
conditions for development of a human capital of the country, perfection
of economic relations of employment. For this purpose it is necessary to
reduce level of redundant employment at the enterprises, flexibly to
redistribute liberated workers in other branches and employment kinds.

????????????^?structural reorganization of production, formation of
effective social policy.

List of used literature

Economics N. Gregory Mankiw and Mark P. Taylor

Economical mentality Heine. P 2002

Aleksey Vojlukov, it is published in «the Business journal Online», on
September, 10th, 2007.

PAGE – 3 –

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