Question

3. Are minimum-wage laws a better explanation for structural unemployment among teenagers or among postsecondary graduates? Why?

4. Statistics Canada announced that in May 2015, of all Canadians aged 15 years and older, 17 953 800 were employed, 1 307 600 were unemployed, and 9 970 800 were not in the labour force. How big was the labour force? What was the labour-force participation rate? What was the unemployment rate?

Answer 1

3) Structural unemployment is a type of unemployment that is caused because of change in technology or absence of skills needed in the labour. Minimum wage laws (which guarantee minimum wages to the labour) lead to structural unemployment more in the teenagers than in the post secondary graduates. The reason for this is that the teenagers are not very skilled and mostly perform low skilled work. So any change in the skills or technology leads to them losing the job compared to the graduates who are highly skilled and can adjust comparatively easier with change in skills.

4) Number of employed = 17953800

Number of unemployed = 1307600

Total working population = 19261400

Labour force = Number of employed + number of unemployed = 17953800 + 1307600 = 19261400.

Labour force participation rate = (Labour force / working population) * 100 = (19261400 / 19261400) * 100 = 100%

Unemployment rate = (Number of unemployed people / labour force) * 100 = (1307600 / 19261400) * 100 = 6.78%