Question

Read the following article:
Many face new normal: Part-time pay, Full-time bills. The Wall Street Journal, Eastern edition. (11/13/14.)

Question 6. What is your interpretation of the advantages and disadvantages in the way in which unemployment is measured? Is unemployment a social or an individual’s responsibility?

Answer 1

The term Unemployment, is used for a situation or a person who is willing to work and have all the required skills to work but is unable to find one. There are basically four main types of unemployment within an economy :-

i) Frictional Unemployment

ii) Structural Unemployment

iii) Cyclical Unemployment

iv) Seasonal Unemployment

These different types segregates the different forms of measuring it too - Unemployment = No. of unemployed force / No. of labour force.

There are various different ways to calculate the rate of unemployment in an economy -

a) through sampling and surveys

b) government records and data

The major advantages of these methods to measure unemployment are :-

1) the process of conducting surveys and sampling in different regions, on different genders and class is more accurate and just

2) is useful in acknowledging and curbing the shortcomings in the system which create unemployment in the system

3) focuses in controlling the rate of unemployment through providing basic skills and training to the workforce

4) it taps both the areas comprising, no. of employed and unemployed forces in an economy

The major disadvantages of these methods to measure unemployment are :-

1) it does not take into account the exact number of people willing to work or are finding work

2) it excludes the self employed forces and people who seek voluntary retirements and getting pension benefits

3) people doing part time jobs are considered unemployed only

4) there are often various errors in assessment and reporting of the statistics and data

The condition of Unemployment is both a social as well as an individual's responsibility:

- Social : As per the Corporate Social Responsibility (CSR) plans by different organisations -

They must work for the growth and development of an economy through which they earn profits and revenues.

They should create various programs to educate and upskill the unemployed workforce

By generating employment through intoducing in favourable work opportunities for them

- Individual's : sometimes there is a personal choice and behaviour which leads to unemployment -

One should be willing to work rather being lathargic

People getting money from various government schemes made for unemployed and needy are mostly unwilling to work

People having higher qualifications and skills don't go for low profile jobs

People are not ready to change their location inorder to find and get a suitable job