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ØFrictional unemployment ØStructural unemployment ØCyclical unemployment ØSeasonal unemployment
Frictional Unemployment: A type on unemployment caused by workers voluntarily changing jobs and by temporary layoffs; unemployed workers between jobs. Cyclical Unemployment: A type of unemployment caused by insufficient total spending or by insufficient aggregate demand.
Structural Unemployment: It is the unemployment of workers whose skills are not demanded by employers, who lack sufficient skill to obtain employment, or who cannot easily move to locations where jobs are available. Seasonal Unemployment: It is the type of unemployment which is caused by the seasonal nature of some industries like agriculture etc.
Causes of Unemployment n n n Higher growth rate of population. Technology Business Trends Nationalization of Business Units Political & Economic Scenario n n n Lack of technical education Shut down of Industrial units Inefficient Micro Financing Schemes Voluntary Unemployment Smuggling etc….
Where Problem lies? ? Total population= 160 millions (approx. ) Labor force= 51. 78 millions Percentage labor force= 51. 78/160 *100=32. 3% Out of 51% population of women only 13. 43% are in labor force. Out of 49% population of men 52. 1% are in labor force. So, Pakistan has to increase its labor force to a great extent.
World Labor Force: 2007 -Total Labor Force of The World= 3140. 3509 million (approx. ) 2008 -Total Labor Force of The World= 3166. 66 million (approx. )
World Unemployment Rate: World Unemployment Rate 2007 - 5. 7% Unemployed Population 3140. 3509*5. 7/100=179 million (approx. ) World Unemployment Rate 2008 - 6. 00% Unemployed Population 3166. 66*6/100=190 million (approx. ) World unemployment rate has been ranging from 5. 7%-6. 3% over the last ten years
Economic and Social Impacts of Unemployment: Okun’s Law: For every 1% increase in employment rate GDP falls by 2%. . n When unemployment increases goods and services produced in a country decreases and it adversely affects the economy. n
n Increased Crime and Social Strife n Deflationary Pressures n Decreased Growth n Low purchasing power of people n Increased Government Spending n Investors hesitate to invest where unemployment rate is high.
Conclusion: n Unemployment is a heinous problem of the whole world. Same is the case with Paksitan with multiple challenges. Pakistan has to eradicate this economic and social evils along with all of its aspects to the maximum extent.