Essay - Unemployment Outline Introduction Causes of Unemployment A) the Four Components...


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Unemployment

Outline

Introduction

Causes of Unemployment a) The four components (Cyclical, Structural, frictional and seasonal *****) b) Increased productivity c) Globalization, Outsourcing

Unemployment Statistics a) National Unemployment Rates b) State wise Comparison

4) Effects of Unemployment

Okun's Law (Relation between GDP and *****)

Unemployment ***** National Debt

*****) Unemployment Benefits

Unemployment Insurance

Extended benefits (TEUC)

Trade Adjustment Assistance (TAA)

***** Reemployment Accounts (PRA)

*****) Personal Effects of Unemployment

Financial Strain

Psychological effects

***** on family

*****) C*****clusion

*****

*****sis high rate of unemployment has a negative effect on the nati*****al economy and greatly affects the living st*****ards ***** the people. Apart from the loss of productivity and the consequent economic downslide, unemployment also has negative psychological implications and damaging ***** on the family structure.

Introduction

Unemployment is one of the major economic problems affecting a nation. The United *****s, one of the vibrant economies in ***** world currently suffers ***** a huge ***** crisis with more than 8 million ***** in the civilian workforce without jobs. After a decade of continued ***** consistent growth (1990 to 2000), which saw a growing GDP and a booming economy, *****re st*****rted a period ***** recession. Unemployment rates reached a recent ***** of 6.1% in June 2003. The ***** of ***** and the extended unemployment ***** have created additional strain on the already deficient federal budget, which in turn has resulted in higher burden for ***** tax pay*****g citizens. Let us analyze the underlying causes for unemployment, the unemployment support ***** provisions *****fered by ***** government and the effects of unemployment on ***** individual as well as the *****al economy as a whole.

***** of Unemployment

There are several causes ***** unemployment situation in any market driven economy. Accord*****g to economists Friedman and Phelps, any nation at any given point of time, would continue to have a certain "natural rate" of unemployment. As per their hypothesis, an increase in total demand does not just result in a decrease ***** ***** rate but also creates an ***** in inflation. Likewise a decrease in ***** demand will result ***** an increase in unemployment rate *****d decreas*****g *****. There always exists a *****iodic oscillation in aggregate demand and hence a consequent flux ***** unemployment rate, which is referred to as cyclical unemployment. [Paul Krugman].

***** have studied that an increase in productivity and an *****crease in the labor force will both worsen the unemployment situation. As economist Heilbroner observes, "On ***** domestic front, they include a technology of rampant automation that ***** created severe employment *****s in all advanced countries..The result is prospective increasing dependency on government-financed programs of un***** relief or public works." [Heilbroner, 120]. Furthermore unemployment situation can be worsened ***** government policies such as price control, monopoly privilege to companies ***** even extensive government spending. [Judd W. Patton] The emerging Globalization phenomenon also has a significant effect on our national *****. Employer initiated layoffs ***** observed to ***** on the rise over ***** last decade. Outsourcing of jobs to other developing countries is one

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