LABOUR MARKET

Unemployment in Labour Market



Unemployment in Labour Market

Introduction

Unemployment can be defined as the idle state of a person willing to work. This definition of unemployment has many variants and the concept always gives rise to controversy and theoretical statistics (Stumpf et al., 1994, 221-235). Unemployment in the labour market refers to the situation of the worker who has no job and therefore no wages. Economists have described the causes of unemployment as frictional, seasonal, structural and cyclical. Unemployment can essentially be voluntary or involuntary (Burchell, 1994, 188-212). Involuntary Unemployment includes all persons seeking work and are willing to accept minimum conditions even though they are trained for jobs they are being considered. Voluntary employment on the other hand refers to deliberate back out from work based on various reasons. The paper aims to discuss the impact and incident of voluntary employment with respect to the labour market.

Thesis Statement

Unemployment within the labour market is primarily voluntary.

Discussion

The word “voluntary” refers to the mindset of unemployed people who cannot be observed objectively, so that differences in “voluntary” or “forced” in the analysis of unemployment does not make sense (Leana & Feldman, 2002, 171-175). It may also be due to the fact that they do not want to work, or at least do not want to work at the present time, or because they want to get a job or may be looking for a more interesting proposition (Stumpf et al., 1994, 221-235). The concept of voluntary unemployment is used mainly in the context of economics and public finance. Unemployment is voluntary if the employee refuses to adapt to new conditions in the labour market. The employee then considers that the remuneration for his work does not compensate for the work being done by the acceptance of employment: the extra consumption to which he could access does not compensate the drudgery and loss of benefits of inactivity (Chrystal, 1994, p.16). It includes those people who leave or do not take a Job in the expectations of getting a better opportunity, but would accept in case if such an alternative does not exist. Here, a part of frictional unemployment is voluntary because people prefer to seek unemployment, rather than accept an opportunity that seems disadvantageous (Brockner & Greenberg, 1990, 45-75).

Frictional unemployment happens because workers who are seeking a job cannot find it immediately and looking for work; they are still counted as unemployed. The amount of frictional unemployment depends on the frequency, with which workers change jobs and the time it takes to find a new one (Layard, Nickell & Jackman, 1991, 56-59). The change of use occurs often and a large percentage of unemployment is frictional that lasts only for a short time. This kind of unemployment could be reduced in some way by making more efficient placement services. However, if workers can freely leave their work will be a cyclical unemployment (Burda, 2009, p.322). The labour force is defined as all persons of working age who are available in the labour market, ...