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Unemployment - Solutions To The Unemployment Problem

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Much of the discussion on finding solutions to the unemployment problem has centered on the pivotal role of faster economic growth and cuts in real wages. Faster economic growth is viewed as a means of generating more jobs. Cuts in real wages are a reaction to the view that through their demands for higher wages, some groups of workers have priced themselves out of a job. How much growth and how large a fall in real wages would be required to reduce the size of the unemployment problem both remain matters for debate. Ottosen and Thompson (1996) suggest an overhaul of the National Labor Relations Act in the United States as a way of preventing unions from delivering the monopolistic wages and fringe benefit premiums that raise business costs and lead to unemployment. Such proposals are often very difficult to implement. Simulations by Guy Debelle and James Vickery (1998) for the Australian labor market are suggestive of manageable wage cuts only if the unemployment target is not set too low. Such advice is not very encouraging. Moreover, many researchers believe that the levels of economic growth required to make a major difference to the unemployment problem are unlikely to be sustained by most economies.

The United States and other countries could take other approaches to help reduce their unemployment rates (Ottosen and Thompson 1996). First, the methods of accumulation and dissemination of information on available jobs and workers could be improved. Ottosen and Thompson have suggested following the Swedish model, in which job centers have a nationwide, integrated database of jobs, employers, and available employees. This type of database could reduce the time spent by an average worker on the unemployment roll and thus reduce the unemployment rate. Second, unemployment agencies could tighten their job search and job acceptance requirements. Third, there could be improvements to the education and training provided to young people, with a greater focus on vocational skills. Finally, countries need to ensure that their welfare systems do not provide disincentives to work. Australia, for example, has strengthened the "Mutual Obligation" requirements (e.g., taking part in Work for the Dole projects) that eligible job seekers must meet in order to avoid loss of part of their income support.

There may also be a role for unemployment programs that target various groups of jobless persons. Carol West (1994) surveyed the unemployment programs aimed at reducing cyclical, frictional, seasonal, and structural unemployment in the United States. Some of these programs aim to change people to match existing jobs while others create jobs to match existing worker skills. The change in focus over time and the short duration of many programs make evaluation difficult. Many programs appear to do little more than reorder the line of unemployed people, though obviously they have the potential to fulfill an equity function in the labor market. John Piggot and Bruce Chapman (1995) suggest that labor market programs can be a cost-effective means of managing the pool of unemployment.

A number of other solutions to the unemployment problem have been advanced in the literature. For example, work sharing, early retirement, and reduced migration have been discussed. These policies affect the labor market by reducing the supply of labor. However, they have not won a great deal of support among economists.


Bibliography

Barling, J. (1990). Employment, Stress, and Family Functioning. New York: John Wiley and Sons.

Berry, A.; Mendex, M. T.; and Tenjo, J. (1997). "Growth, Macroeconomic Stability and the Generation of Productive Employment in Latin America." In Employment Expansion and Macroeconomic Stability under Increasing Globalization, ed. A. R. Khan and M. Muqtada. London: Macmillan.

Bregger, J. E., and Haugen, S. E. (1995). "BLS Introduces New Range of Alternative Unemployment Measures." Monthly Labor Review 118(October):19–26.

Britt, C. L. (1994). "Crime and Unemployment among Youths in the United States, 1958-1990." American Journal of Economics and Sociology 53( January):99–109.

Cantor, D., and Land, K. C. (1985). "Unemployment and Crime Rates in the Post-World War II United States: A Theoretical and Empirical Analysis." American Sociological Review 50( June):317–332.

Debelle, G., and Vickery, J. (1998). "The Macroeconomics of Australian Unemployment." In Unemployment and the Australian Labour Market, ed. G. Debelle and J. Borland. Sydney: Reserve Bank of Australia.

Finegan, A. T. (1978). "Improving Our Information on Discouraged Workers." Monthly Labor Review 101(September):15–25.

Gitter, R. J., and Scheuer, M. (1997). "U.S. and German Youths: Unemployment and the Transition from School to Work." Monthly Labor Review 120(March):16–20.

Haugen, S. E., and Parks, W., II. (1990). "Job Growth Moderated in 1989 while Unemployment Held Steady." Monthly Labor Review 113(February):3–16

International Labour Office. (1998). Yearbook of Labour Statistics. Geneva: Author.

Jackman, R. (1997a). "Unemployment and Wage Inequality in Advanced Industrial (OECD) Countries." In Employment Expansion and Macroeconomic Stability under Increasing Globalization, ed. A. R. Khan and M. Muqtada. London: Macmillan.

Jackman, R. (1997b). "Macroeconomic Policies, Employment and Labour Markets in Transition in Central and Eastern Europe." In Employment Expansion and Macroeconomic Stability under Increasing Globalization, ed. A. R. Khan and M. Muqtada. London: Macmillan.

Kenyon, P. (1998). "Discussion of 'Dimensions, Structure and History of Australian Unemployment' by Jeff Borland and Steven Kennedy." In Unemployment and the Australian Labour Market, ed. G. Debelle and J. Borland. Sydney: Reserve Bank of Australia.

Le, A. T., and Miller, P. W. (2000). "Australia's Unemployment Problem." Economic Record 76(March):74–104.

Liker, J. K., and Elder, G. H., Jr. (1983). "Economic Hardship and Marital Relations in the 1930s." American Sociological Review 48( June):343–359.

Ottosen, G. K., and Thompson, D. N. (1996). Reducing Unemployment: A Case for Government Deregulation. Westport, CT: Praeger.

Piggott, J., and Chapman, B. (1995). "Costing the Job Compact." Economic Record 71(December):313–328.

West, C. T. (1994). "The Problem of Unemployment in the United States: A Survey of 60 Years of National and State Policy Initiatives." International Regional Science Review 1 and 2(16):17–47.

Wooden, M. (1996). "Hidden Unemployment and Underemployment: Their Nature and Possible Impact on Future Labour Force Participation and Unemployment," National Institute of Labour Studies, The Flinders University of South Australia, Working Paper No. 140.

Yang, B., and Lester, D. (1994). "Crime and Unemployment." Journal of Socio-Economics (Spring-Summer) 23:215–22.


Other Resources

Bureau of Labor Statistics. Monthly Data from Employment and Earnings. Available from http://stats.bls. gov/cpsee.htm

Bureau of Labor Statistics. Labor Force Statistics from the Current Population Survey. Available from http://stats.bls.gov/cpsatabs.htm

California State University, Fresno. Econ Data and Links. Available from http://www.csufresno.edu/Economics/econ_EDL.htm.

International Labour Office. Labour force statistics from ILO database LABORSTA. Available from http://laborsta.ilo.org/

International Labor Organization. Web site. Available from http://www.us.ilo.org/.

Organisation for Economic Co-Operation And Development. Labour Force Statistics. Available from http://www1.oecd.org/std/lfs.htm.

World Bank Group. Data by Topic. Available from http://www.worldbank.org/data/databytopic/databytopic.html

ANH T. LE

PAUL W. MILLER

[back] Unemployment - Who Becomes Unemployed?

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over 3 years ago

I m not geting what I want.please provide me proper information about "overcome the problems of unemployment".











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about 3 years ago

the problem can be overcome lets look for better solutions

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about 2 years ago

These notes were quite useful to me...

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about 2 years ago

we should look to better sloutions

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about 2 years ago

than you

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over 3 years ago

good

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almost 3 years ago

citizens of a nation should be taught in there nation languages. but not in English because its the first international language.that is totally fake

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about 3 years ago

the problem can be overcome lets look for better solutions

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about 3 years ago

DROPPP IT TO DA FLOORRR!!!!!!!!! YEAHH BABY

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about 2 years ago

thanks

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about 2 years ago

than you

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about 3 years ago

Retailers aren't hiring because they are "nervous" about where the economy is heading so they will not hire. Thus, those working are doing the work of two people. Customers are accepting the long wait in lines or trying to track someone down in stores for service. We should begin using the 5 minute rule. If one waits more than 5 minutes for help or in a line, leave your cart or merchandize where it is and walk out. Customers are "accepting" lack of service and companies are able to survive paying fewer staff. If customers accept this way of life, employment will remain stagnant. We need to have a "walk out after 5 minutes day".

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about 3 years ago

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about 3 years ago

GAYYYY!!!!! iloveitttt

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over 3 years ago

from ejo

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over 3 years ago

IN my opnion solution of unemployment is decrease the proverty bycontrol the birth rate,

the indian people do not go to foreign countries they settiled in india and improve their ideas,if the people do not see the wether it is small job r not any thing they do

some of the people see the job satisfaction i think it's not correct

we have any opertunites first try that after that it will sucess or not

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almost 4 years ago

thats a tight beat

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18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

18 days ago

this is a good article..
To all Filipinos , earn money at the comfort of your own home.
Work without a boss. This is for real for I am one.
for more details, kindly visit http://www.unemployedpinoys.com or send a message to
0927-784-2247

Vote down Vote up

3 months ago

Online jobs -data encoder . Part time/full time
You can earn while enjoying time with your family and love ones.
for more details, kindly visit http://www.unemployedpinoys.com/
to get started., Email me at besbremisana@yahoo.com

Vote down Vote up

3 months ago

Online jobs -data encoder . Part time/full time
You can earn while enjoying time with your family and love ones.
for more details, kindly visit http://www.unemployedpinoys.com/
to get started., Email me at besbremisana@yahoo.com

Vote down Vote up

5 months ago

Unemployed Pinoys can earn while enjoying time with their family and loveones.
Unemployed is Brave and a choice to be a Freeman.
Join us today at http://www.unemployedpinoys.com

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over 1 year ago

I have spent 40 years thinking about the unemployment crisis every time we had a recession. This has resulted in my developing an idea that can reduce unemployment by enabling employers to use their workers when needed and allowing workers freedom to explore options like education, home projects, or long vacations without loosing their employment security. Since it frees up opportunity for individual creativity it also increases total productivity. See my blog: gleeaikin.blogspot.com, for this 6 installment posting on Oct. 21, 26, 27, Nov. 2, 4, and 5, 2012. There you can comment and help me refine and develop this idea.

I believe that if fully implemented in a country, state, city, the plan could result in a 2 or 3% reduction in unemployment in two years.

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almost 2 years ago

how doe resolve the unemploment problem in this country?

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about 2 years ago

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