Unemployment - What is it? types, measurement, causes, consequences, and more

Unemployment

The situation in which an individual presents the absence of any type of work activity.

What is unemployment?

Unemployment is a situation in which an individual presents the absence of any type of work activity, that is, that situation in which a person does not have a job and is not linked to an employer or activity that produces some type of monetary profit.

This condition can be classified as involuntary or voluntary since the affected person has total freedom to decide whether or not to carry out work operations, however, there are many involuntary situations in which the person cannot find a suitable job. to their qualities or studies carried out, either due to lack of experience, lack of opportunities, among others.

Unemployment is a social problem that negatively affects the individual and society, since, by not presenting an entry of resources, individuals will not be able to contribute monetarily to their family nucleus, thus causing a decrease in demand and production. of goods and services by these families.

types of unemployment

The main types of unemployment are listed below:

• Seasonal unemployment: that situation in which employers go through periods in which production decreases and consequently, they do not require many workers. This type of unemployment tends to decrease when production rises since the employing organizations require more personnel to carry out their operations.
• Cyclical unemployment: that situation in which a State goes through a certain economic cycle, therefore, this type of unemployment increases due to the appearance of crises or recessions and, on the contrary, in phases of expansion. The level of unemployment rises because the employer organizations are directly affected by these cycles and decide to suspend their activities since this crisis does not allow them to generate profits.
• Frictional unemployment: that condition in which the affected individual carries out in a certain period of time the process of searching for a job that meets their requirements or needs, therefore, this situation is temporary.
• Structural unemployment: that situation in which there is greater labor demand than job offers, that is, there are more individuals looking for a job than available vacancies.
• Institutional unemployment: that situation caused by a legal variant, that is, by government intervention, either by some law or guarantee imposed by it.
• Voluntary unemployment: that situation in which the affected individual decides freely and voluntarily not to carry out work operations or seek a job.
• Involuntary unemployment: that situation in which the affected individual does not voluntarily decide to carry out work operations, instead, he or she is affected by some cyclical phenomenon or condition that does not allow him or her to carry out work activities.

Measurement forms

The main ways of measuring unemployment levels are listed below.

Unemployment rate

This indicator makes it possible to identify the existing difficulty in a country in finding a job, therefore when its levels are high, society will have greater difficulties in finding a job and vice versa when the rate is low. The unemployment rate is calculated by dividing the number of unemployed workers by the active population, and the active population is calculated by adding employment and unemployment.

Labor force survey

This survey is carried out with the aim of giving an estimate of the percentage of the population that is unemployed. This study takes a sample of 200,000 individuals and interviews them by telephone or in-person. These data are calculated every 3 months by a commissioned institute.

SEPE (Spain)

SEPE is one of the entities that make up the national employment system. This agency carries out a count of individuals who are registered as unemployed in any of its offices. These data are later used to make monthly counts which are published.

The SEPE has some exceptions for people that it does not count as unemployed, these exceptions are listed below:

• Those who receive an agricultural subsidy.
• Those who are of their own free will decide to deactivate the SEPE.
• It does not include those who take training courses. The SEPE organizes courses so that the unemployed can improve their training.
• People over 25 years of age apply for their first job.

Causes and consequences of unemployment

The main causes and consequences of unemployment are listed below:

Causes

• Shortage of jobs.
• Lack of experience.
• Economic crises, force employer organizations to cease production.
• Natural disasters.
• Lack of educational preparation on the part of the unemployed.
• Replacement of human labor by machinery and technology in organizations.
• Government laws.
• Voluntary decisions by the unemployed.

Consequences

• Decrease in personal income.
• Decrease in the economic contribution of the region.
• Significant reduction in the consumption of goods and services.
• Increase in public spending.
• Increase in social inequality.
• Greater uncertainties regarding the unemployed.
• It can lead to higher crime rates and economic informality.

 

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