UNEMPLYMENT AND INFLATION
In this report I will illustrate how unemployment and inflation in the UK has changed since 1980 to the present day. I will also analyse the Governments current strategies for dealing with inflation and unemployment.Unemployment is when people are joblessness. The measure of unemployment is the number of jobless people who are available for work and are actively seeking jobs. There is a waste of scare economic goods when there is unemployment and this reduces the long run growth potential of the economy. When there is high unemployment, the economy is producing within its production possibility frontier.However if there is a reduction in unemployment, the total national output can increase leading to an improvement in economic welfare.The Office for National Statistics (ONS) publishes two unemployment rate measures. There is the rate based on the claimant count, which includes all those who are unemployed and actually claiming benefit from Jobseekers Allowance; and the Government's preferred International Labour Organisation total, which includes people not eligible for benefit. The following diagram uses the claimant count to
Also the Thatcher Government shut down all the coal mines industries and shot up the unemployment figures as these people were finding it difficult to find jobs as they had fewer qualifications. On the short run aggregate supply curve, there would be an inward shift, which shows a reduction in aggregate demand and a fall in real output, but an increase in the general price level. com accessed on 27 November 2003APPENDIX . There will be also training and re-skilling for the unemployed, with the Employment Service for thirteen weeks who will then offer them work experience Furthermore they will try to encourage people to do volunteer work so they can gain new skills so they can get back on the work force. PROBLEMSThe problems now compared with the last two decades are that manufacturing jobs are getting lesser and also jobs are being imported to other countries. uk accessed on 18 November 2003The National Institute Economic Review from the CLARE Group of economists. However there was a slowdown through 1998 and 1999. At the present moment 10,000 manufacturing jobs are being lost each month. see how many people are unemployed between 1992-1999. People will not be able to stay onto benefits for too long; this will then encourage them to find work. The Cost-push inflation is caused by a sustained rise in prices caused by businesses to protect/maintain profit margins after experiencing an increase in production costs. 48 million, keeping the jobless rate at 5%, also the manufacturing industries has lost 121,000 jobs since the same period last year. BIBLIOGRAPHYwww.
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18 november 2003,
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Acceptance Essays
