unemployment

Causes of unemployment 



Causes of unemployment

 Causes of structural unemployment

 Structural unemployment occurs when the labor force does not match the available jobs; Where the available job opportunities may not be in line with the skills of individuals, or there will be no job opportunities for them, and one form of this is observed in the seasonal unemployment of the sectors of agriculture, tourism, and construction, which is linked to a certain season of the year, so job opportunities are available in that season and after that the workers become without work until the next season, and structural unemployment is long-term and not voluntary, and the reasons leading to it can be summarized as follows:  The replacement of the workforce by machines, robots and modern technology. The workforce lacks the necessary skills and training for the available jobs. Transferring factories to other countries where the wages of the labor force are lower in order to reduce costs, which leads to the loss of former workers' jobs.

Causes of cyclical unemployment

 Cyclical unemployment results from a lack of demand for goods and services, and it is also called Keynesian unemployment. [5] During the period of economic growth,[6] the number of available job opportunities is less than the number of job seekers, and this unemployment is called cyclical because it works as a cycle that begins with a decrease in demand for goods and products and affects the profits of companies, which pushes companies to lay off their employees, and the high unemployment rate The resulting job loss leads to a decrease in consumer demand


Causes of institutional unemployment

 Institutional unemployment results from institutional factors and causes, represented in the following: [6] Governmental policies represented in social security programs that are costly to companies in some countries, and some professional licensing laws that have significant restrictions on individuals and companies. Labor market practices represented in giving wages for efficiency and excellence in jobs. High rate of membership in labor and professional unions. Raising the minimum wage due to government policies or unions, which leads to making the labor force more expensive for companies, which reduces the number of job opportunities available in the labor market,[7] so companies lay off their employees to reduce costs,[4] and job seekers refuse Jobs with salaries that are less than the minimum wage, which contributes to preventing them from obtaining jobs, resulting in institutional unemployment.[2]


Causes of Frictional Unemployment

 Frictional unemployment can be defined as unemployment that occurs when a worker loses his job and starts looking for a new job. Therefore, it is also called search unemployment , [2] Frictional unemployment is considered the least problematic type of unemployment from an economic point of view, because it is short-term unemployment and ends as soon as the individual obtains a new job, but getting out of it requires effort that starts from the process of searching for the individual for work. Going through the interview procedures and the completion of the recruitment process,[6] and the reasons leading to frictional unemployment can be summarized as follows: [4] Leaving work voluntarily to search for another suitable job opportunity that meets the needs of the worker, and the individual may have saved an amount of money that enables him to leave the current job and search about another job. The worker moves from his place of residence in which he works to another place, which requires him to leave his old place of work and search for a new job in his new place of residence. Students graduated from universities and schools and are looking for job opportunities. People who have stopped working for a while due to the responsibilities of marriage, child-rearing, or caring for their parents are looking for jobs again.

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