It will also look at the causes and the effects if unemployment, the rate of unemployment in Saudi and the prevalence of unemployment in various sectors of the economy. The paper will also look at solutions to the problem of unemployment and recommendations that are intended to solve this issue. Unemployment is a situation where an individual who is willing and able to work is not able to get a job. The different types of unemployment include cyclical unemployment, frictional unemployment, classical unemployment and structural unemployment. Classical unemployment occurs when the wages associated with jobs are set above the market level such that there are high numbers of job seekers that exceeds the available vacancies.
Minimum wage helpful or disastrous for Americans Did you know that millions of minimum wage workers cannot make enough money to be over or at the poverty line level and are actually a lot more below it instead? There have been many issues on the topic of increasing the minimum wage from ten to fifteen dollars because it can cause inexperienced workers having a tough time getting or looking for jobs, families not being able to live on the minimum wage the way it stands now, and businesses not being able to create more jobs to hire more workers. For instance, an author named David Neumark believes that the effects of the minimum wage have a major issue that increasing minimum wage can reduce the numbers of jobs and pretty much screw over workers
For instance, of the causes are considered the extreme unemployment benefits, excessive minimum wage and hiring cost, too high real wages level, the disparity between the unemployed labour and job offers on the market in terms of skills and many others reasons (Bell, 2000). At the same time unemployment impacts the economy and the society. Economy experiences decreased spending power of the families and extra expenditure on unemployment benefits, the society meets changes in the mental health, crimes and violence, standard of living and others. There were many studies conducted on dependencies and mechanisms of unemployment. Unemployment can explained by many factors as well as inflation.
Demand pull inflation is when total supply of goods and services is insufficient to meet total demand for goods and services by the economy. Cost push inflation is the price increase as a direct result of the increase in the production cost mainly labor cost. The increase in wages and salaries are handed on to consumers in the form of higher prices. Imported inflation occurs when inflationary pressures which develop overseas are transmitted to the domestic economy through the mechanism of international
As the wages of low-skill labor increases, greater incentive and implied turnaround is expected through the implementation of automation, lessening the availability of the low-skill roles in the labor market, further polarizing the wage inequality between different skill sets. Through its varying forms in the labor market, automation holds an impactful stance on the inequality of wages. By increasing the gap in labor roles and lessening the distribution of income through investment of physical assets, automation is causing a great decline in the equality of wages in the economy. A lack of wage equality holds a larger stance on the global stage, setting boundaries for developing countries in manufacturing and furthering the already developed. Wage inequality introduces a new gap in the manufacturing industry: one that will only be exacerbated with
This is because it would increase the unemployment rate, harm worker health and step up living expense. Minimum wage law tends to have a worse effect on the employment rate. In fact, 90% of the company in Hong Kong is small and medium enterprises and their daily operation is already difficult. By setting up the SMW, those companies are required to follow the law but most of them are not able to afford the extra expenses from pay rise. According to Schmitt (2013), the minimum wage has slight or even no noticeable effect on the employment rate in that the cost generated by minimum wage is large relative to most of the firms.
b) Slow Industrial Growth Due to use of backward techniques of production our industrial sector is not at developing form. Its fewer production also creates shortage in market and caused of inflation. c) Increase in Wages & Salaries Present era labours are demanding high wages and salaries. Increment in wages and salaries it might be leads to increase in cost that increases the prices. On the other way due to high wages and salaries there is an increment in income and it reason in inflation.
Unemployment is important issue that our government faces. Our leaders are trying to do their best to solve it wisely. Unemployment are the people who does not have any labor. There are many causes for unemployment which affects strictly and fetch new issues every moment. Our society is still suffering from overpopulation, and non-educational people, the problem of unemployment increases day by day.
Bairoch (1976) hinged its argument on the cause of unemployment to the intrinsic relationship between excessive supply of labour and the rate of growth of the population30 .it argues that the size and growth rate of the labour force is ultimately dependent on the size and growth rate of the population. He opined that both the population grew too rapidly in developing countries, and consequently the size of the labour force, to the extent that employment growth could not keep pace, thus resulting in growing unemployment. This theory rings true to some extent as the cause of unemployment in the country,where studies have shown that the economy grew too slow to cope with its ever increasing labour force. It has the higest population in Africa and is among the countries in the world with the highest population growth rate.its population grew from about 70 million in the 1980s to over 185 million today31. This is however in stark contrast to its economic growth as shown in figure
The failure of these theories of a constant and mean reverting unemployment rate of unemployment to explain the higher rates of unemployment experienced in Europe led to alternative explanations. The most conspicuous in literature is the known as Labour-market hysteresis. Hysteresis proposes an alternative approach to explaining differences in unemployment. If the actual unemployment rate is influenced by aggregate demand, it follows that natural unemployment can also be influence by demand side