The paper "Unemployment in Australia" is a perfect example of a micro and macroeconomic case study. Unemployment can be defined as the number of people willing and able to work but are not in a position to secure a job opportunity. There are many different types of unemployment depending on the nature and situation of unemployment. However, these types of unemployment are categorized into two major categories; voluntary and involuntary unemployment. The various types of unemployment include; frictional unemployment- this type of unemployment involves workers leaving their jobs and start looking for new jobs, cyclical unemployment- this is caused by business cycles, particularly the contraction phase cycle.
Seasonal unemployment- this type of unemployment occurs when people lose their jobs during particular seasons. It is common in the agricultural sector, hotels and catering and tourism, structural unemployment- this type of unemployment occurs as a result of technological changes in the economy. Due to technological growth, workers may be sacked and replaced with robots which will operate the machines. Views of economist on unemployment Different economists have different views on unemployment. According to the classical unemployment will occur when real wage in the economy is above the equilibrium point.
Setting the wages above the market-clearing point will ensure that labor surplus. The classical argue that the problem of unemployment would be solved if the wages are flexible. Diagram A: classical representation of classical unemployment. Q1 is the quantity of labor supplied in a free market. The Keynesians however, criticizes the classical argument saying that the main problem that may lead to unemployment is due to shortage of the aggregate demand (AD) in the economy. For instance, by cutting the wages, the aggregate demand in the economy would reduce.
Therefore it would not be effective to solve unemployment by cutting the wages. In Australia according to the Australian Bureau of Statistics (ABS), almost a third of all the youths are unemployed. The high rate of unemployment of the youths who ranges between 15-24 years has for long remained high since the global financial crisis occurred. Since then the rate has remained high for almost a decade.
Work citedCockx, Bart. Youth unemployment in Belgium: diagnosis and key remedies. No. 66. IZA Policy Paper, 2013.