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Introduction to Economics for Busines

   

Added on  2020-04-07

17 Pages4440 Words387 Views
Professional DevelopmentEconomicsPolitical Science
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1Economics for Business
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2IntroductionUnemployment rate is the mostimportant economic needle which determines the operatingcapacity of a country. It is one of the most significant and disturbing crisis which the wholeworld is facing. In the recent times, it is a catastrophicunderutilization of human as well aseconomic resources. The following essay provides a critical evaluation of unemployment ratein Australia. The easy discusses the unemployment types, issues, and government policy ofAustralia along with unemployment in various states of Australia such as NSW, WA,Tasmania, Queensland and SA. A number of Australian researches reveal unemploymentproblem in the country supported by micro and macroeconomic perspectives. In Australia,due to unemployment, workers and their families lose their income, and the country loses thegoods or services that could have been manufactured. Also, government face disappointmentwhich builds spur for anti-government operations. As a result, purchasing ability of theworkers is significantly reduced, which can minimize the rate of economic growth andeconomic development of Australia. In the beginning of 1993 and 1994, the unemployment rate of Australia exceeded to onemillion. It led to an unexpected decline in the nation’s Gross Domestic Product rate andultimately, the economic growth also dropped. Moreover, the key factor of Australianpoverty is unemployment. Although, the negative impacts of global recession were overcomeby the country in an efficient way, yet there is a gradual increase in the unemployment indifferent regions of the country since 2008 (Campbell, 2016). The essay further discusses thefiscal stimulus, tax cuts, and increased public expenditure of the country along with economicdownturn which led to increased unemployment. The adjustments in working hours althoughminimized job losses, but this contributed to the growth of the disagreement in the workers. Itobserved a rapid increase in the youth idleness level.
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3Unemployment RateUnemployment signifies those people who are in the need of work, able and willing to workbut do not find any work. Unemployment rate in Australia symbolizes the fraction of theentire workforce that is unemployed, but looking for employment and actively searching forwork. Moreover, the unemployment rate is computed as a percentage by dividing the numberof unemployed persons by the existing total number of workforce (Milner et al., 2013). In thetimes of downturn, there is a relatively high unemployment rate in Australia due to lowmarket demand and cost cutting strategy by most of the companies. The unemployment rateis changed in the country with the fluctuation in demand of the market and economic growthof the companies in Australia. The change in unemployment rate in Australia from 2012 to2017 is defined in the below graph: (Source: Trading Economics, 2017)The above diagram is presenting that the unemployment rate of Australia is not stable andchanging in each year. The graph is presenting that the lowest unemployment rate of thecountry was 5% in 2012 and highest unemployment rate was in 2015. After 2015 the
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4unemployment rate is continuously decreasing due to low market demand and cost cuttingstrategy.The unemployment may be different types, which are defines as below:Unemployment TypesThere are five types of unemployment which are found in Australia. These are Structural, frictional, seasonal and cyclical unemployment and mature-aged unemployment, which are describes as below: Occupational or Structural unemployment: Structural unemployment refers to an unemployment which occurs due to the structural problems within an economy and lack in the demand of the workers in the labour markets (Bidargaddi et al., 2015). In Australia, frequent changes in the technology and taste or preferences of the consumers are the main drivers behind the deficiency of the demand of workers in the labour markets of the country.Frictional unemployment: It is caused by the individuals who spend their time in searching for an appropriate job. The idle time period between jobs is called frictional unemployment. In Australia, frictional unemployment is caused by these two factors:Imperfect information– When an unemployed person is unable identify the locationand status of all vacancies in his area, frictional unemployment is caused in Australia.This can be decreased by Australian government through creating job centres or similarstate-funded operations aiming at increasing information available to jobseekers.Disincentives– In Australia, there are be government disincentives to seek work,which seems to be a well-paid job in actually is less attractive and suitable due totaxation and exclusion of benefits.
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