”I promise to reduce to 5% the unemployment in five years with an unemployment average reduced to 5 months because I am convinced the full job is applicable. English people did it” (Nicolas Sarkozy, 2007… Several months before the fall of Lehman Brothers)
France 04/2012: 10.2%
European Union 07/2012: 11.1%
UK 05/2012: 8.1% (5.4% in 2007)
United States 10/2012: 7.8% (4.6% in 2007)
Japan 02/2012: 4.5% (3.9% in 2007)
Spain 08/2012: 25.1% (8.3% in 2007)
Greece 08/2012: 24.4%
The Labour Market: Demand and Supply
* The labour supply is made up of workers offering their labour force for a given wage (NOT the employment supply from the employers); * The labour demand corresponds with the application of labour force by the employers for a given wage (NOT the employment demand from the workers). * When the supply overtakes the demand, a part of the workforce, deprived of job, is unemployed.
Definition from the ILO (International Labour Organization)
“Unemployment is defined as people of working age who are without work, available for work, and actively seeking employment” (ilo.org) Unemployment rate is defined by the number of people who are unemployed expressed as a percentage of the labour force (=population active). According to the ILO, unemployed includes all of them which, during a reference period, hold simultaneously the three following features: * To be without labour, this means without salaried job or no salaried. * To be available to work in a salaried job (i.e. not to have worked during a given period). * To be in search of a job, this means that we have to take special arrangements during a recent period to look for a salaried job or no salaried. For France, that means to actively search for a job. For France 2012
People that meet these 3 criteria: 3 million
People that meet 2 criteria (except the 2nd): 4.7 million
There is a Halo Around Unemployment: “some people wish to work but are ‘classed’ as being inactive either because they are not immediately available to work (within two weeks) or because they are not actively seeking work). People who fall into these categories form what is known as a ‘halo’ around unemployment” (INSEE). Examples of elements entering this Halo: underemployment, part time workers who want to work more, occasional and crossover with inactivity workers, etc. Different shapes of unemployment
The frictional unemployment, it results from the period which separates the moment when an individual leaves his employment and the moment where he finds the other one; the consecutive unemployment in the time of expectation of the first employment is included in the frictional unemployment. The causes of such unemployment can be structural, implying an increase of the period of expectation of a new employment: in that case, it’s better to assimilate this shape of unemployment to the structural unemployment.
In an economy of full employment, the unemployment is not useless: the frictional unemployment is permanent. * Structural unemployment is a long-term unemployment. It results from socio-economic structures of the country (demographic imbalance, ageing of the productive device, rule inefficient, maladjustment of the qualifications of the workforce to those whom requires the employers…) * Cyclical unemployment is temporary. It is the consequence of a slowdown in the economy. Hidden unemployment
Hidden unemployment consists in several different groups of people: * People who have been unemployed for such a long-time that they have given up seeking a job (have lost hope to find a job). * People who have a part time job but would really like to be working full time: underemployment cf. Halo around unemployment). * Very over-qualified workers searching for another job more relative to their high qualifications. Focus on some populations facing specific issues
* Long term unemployed people
* Young people...