unemployment

UK Devaluation of Sterling 1967

UK Devaluation of Sterling 1967

In 1967, the UK government of Harold Wilson devalued the Pound from $2.80 to $2.40 (a devaluation of 14%). It was a major political event because the government had tried hard to avoid a devaluation, but felt forced into the decision because of a trade deficit, a weak domestic economy and external pressures from creditors. Background to devaluation of 1967 The government pursued an exchange rate peg of £1 to $2.80. A strong Pound was seen as important for maintaining living standards and providing an incentive for manufacturers to increase productivity…

Historical Unemployment Rates

Historical Unemployment Rates

  UK unemployment rates since 1881.   This shows the fluctuations in unemployment over the past 100 years in the UK. Measuring unemployment is not a precise science. This data mostly relies on administrative statistics on the number claiming some kind of unemployment insurance. The government is changing how unemployment is measures. You can view the pdf for more detail on changing methodology of unemployment. Explaining the change in unemployment Cyclical…

The True Level of Unemployment in UK

The True Level of Unemployment in UK

Readers Question: To what extent do the official UK figures for unemployment accurately reflect economic reality? Summary The government publish two unemployment statistics – the Claimant count and Labour Force Survey. The Labour Force survey asks 60,000 whether they are actively seeking work. The claimant count is the number of those receiving job seekers allowance. The labour force is a better guide to unemployment because the claimant count only includes those eligible for benefits. Another factor to consider is the extent of disguised unemployment. This is when people are not counted as unemployed, but they…

The UK Unemployment Mystery

The UK Unemployment Mystery

A feature of the 2008-12 recession, has been a largely unexpected fall in UK unemployment.  Unemployment has fallen much quicker than previous recessions. For example, after the much milder 1981 recession, UK unemployment rose to over 3 million (around 11%) and remained high well until the mid 1980s. After the 1991 recession, unemployment again rose sharply, to just over 3 million. Also, in Europe, unemployment has recently…

Claimant count – unemployment

Claimant count – unemployment

The claimant count records the number of people receiving unemployment benefits from the government. In the UK, the claimant count currently measures everyone who receives Job Seekers Allowance (JSA). To receive JSA the applicant must be actively seeking work and provide evidence and commitment of efforts to find work. The claimant count method is one of two main measures of unemployment. The other method is the ILO Labour Force survey of unemployment. July 2015-  Claimant count 2.3%. ILO Labour force survey…

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Unemployment benefit in UK

Readers question: explain benefits of increasing rate of unemployment benefit – for the unemployed , society and any cost that may result from such policy. Current Weekly Rates of Job Seekers Allowance in UK Contribution-based JSA Age JSA weekly amount 18 to 24 up to £57.90 25 or over up to £73.10   Contribution based JSA  means you must have: worked for 26 weeks in one of these years earning at least the lower earnings limit for that tax year paid class 1 contributions or received National Insurance credits in both of those tax years that amount…

Unemployment during economic boom

Unemployment during economic boom

Q2: Why are there millions of people unemployed even when the economy is booming? During periods of strong economic growth, we can often experience high rates of unemployment. Firstly, there may be structural unemployment. This occurs when the unemployed are unsuited or unable to fill job vacancies. For example, a booming economy may have a growing number of jobs in high-tech industries, but many unemployed may not have the right skills for this job. Alternatively, we could see geographical unemployment. This occurs when the economy is booming in the south,…

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Disguised unemployment

Readers Question: what is the difference between disguised unemployment and involuntary unemployment Definition of disguised unemployment. This is when people do not have productive full-time employment, but are not counted in the official unemployment statistics. This may include: People on sickness / disability benefits (but, would be able to do some jobs) People doing part-time work. People forced to take early retirement and redundancy Disguised unemployment could also include people doing jobs that are completely unproductive, i.e. they get paid but they don’t have a job. In a developing economy like China, many workers…