Unemployment

Unemployment - the Presentation

1; Definition

2; The Situation in the European Union

3; Situation in Austria

4; Types of employer

5; Reasons and causes

6; Effects and Consequents

7; High risk groups

8; Solutions

What is unemployment?

Unemployment is always the result, when the available workplaces cannot adapt to the vacancies and opposite. When the number of persons, who offer their working capacities, climbs over the number of available workplaces, this leads to a lack in workplaces.

Unemployment has become a serious economic problem. In societies like ours the majority of people can make living only by working for others. Many millions of people are both able and willing to work, but simply cannot find a job. The problem here is, that the types of workers who are looking for jobs are often different from the types of workers wanted by the employers.

The Situation in the EU

Unemployment is one of the biggest problems in the EU at the moment. More than 18 millions people are unemployed in the member states of the European Union. And it seems that the unemployment rate may grow because of a recession in the economy. So because of that it is a hot topic of all political parties in the EU. All those parties try to find new and better solutions for reducing the number of unemployed people.

The situation in Austria

In Austria we have the problem with the one of the highest non-wage labour costs.

In future we will have to reduce these costs.

Here is a statistic of  non-wage labour costs in Austria.

The Austrian government has already some employment projects in process. So, for example do young people who left school and didn't find a workplace have to courses of those projects. But my opinion on that project is that it is only done for reducing the number on unemployment statistics. The problem isn't solved by doing that. It just seems as if the situation would be better than it is.

Types of unemployment

We have to differentiate a few types of unemployment

• cyclical unemployment: if a country has an economical boom then people have jobs, if their is an economical bust people lose jobs

• frictional unemployment: you stop working in December and start your new work in March, this period between this months is called frictional unemployment

• structural unemployment: in factories > too old machines, cannot produce enough, sell less products, cannot pay their blue and white collar workers > more unemployed people

• hidden unemployment: dismissed people don't ask for a new job, they also don't register for unemployment benefits, e.g. women after their maternity leave often stay at home with their children seasonal unemployment: e.g. tourism-areas, construction sector

Reasons and causes of unemployment

In the last years there were many changes concerning the market situation, the technology developments and other parts of the labour market. Firms that don't adopt their production program, got a problem, because in the market situation goods that were sold former times are not needed anymore.

A typical example is a typewriting machine. Until the 1980's a typewriting machine was irreplaceable in an office it was the technological standard in the last 100 years.

But today everybody would laugh if the technological standard in an office is a typewriter, because nowadays we life in a computer aided generation.

Another point is that companies replace workers with machines. The machines work round of the clock and the machines don't have to be paid over hours. A machine doesn't break down for a long time so the costs are cheaper and more calculable.

What is more larger companies often change their company headquarters. They choose a country with lower wages and lower labour costs. Sometimes they prefer illegal workers or even children in order to get a higher profit.

But on the contrary job recruits with good knowledge of electronics and mechanics, a rising technical competence and also a wide general education are needed.

As we have a well organized welfare state where people who are on the dole get unemployment benefits, some people don't won't to work because they sometimes get even more money as they would earn when working regularly. I give you an example: An unemployed gets 12 000 ATS unemployment benefits a moth and he works 40 hours per month illegally so in sum he gets 18 000 ATS. If he would work regularly he would get 16 000 ATS. And would have to work 170 hours every moth.

One big part part of non-working people are graduated students. One reason is that many students choose subjects without thinking of the job openings.

Consequences of unemployment

In our society where money means success the unemployment feels useless and he will consider himself a failure.

They are dissatisfied and depressed and this may lead to alcoholism drug problems and homelessness and even to crime

Especially for families it's difficult because they don't have enough  money to afford their basics of life. So because of that government has to help financially, but this causes high costs for working people who have to support the unemployed.

High risk groups

There are some high-risk groups, for example youth, women with little children after their period of restriction or elder people aged 50 and over. Lots of those people can't find a (good) job.

Young people are part of the high-risk group because in most cases they do not have any practical experience and there are lots of young people searching for the same few jobs. That is why there is a high selection rate on the job market. Firms want to employ young people with lots of experience who want to work almost 24 hours a day and earn just a little pocket money.

Women in general, but especially women with little children who want to work again after their period of restriction are another high-risk group.

Their problem is that the probability to have a nursing holiday for their ill children is very high, especially if they have little kids. Another problem is that those women haven't worked for the time of their period of restriction and there might be new trends, new developments or things like that.

The last high-risk group is the large group of over 50 years old people. Their problem is that they cost too much. If a firm employs younger workers they don't have to pay that much as if there would work an elder person. That is why they are fired. And it is almost impossible for those people to find a new working place.

Solution of unemployment

Possible solutions:      Early retirement

Job-sharing

New jobs (new economy )

A general reduction of working hours

Reduction of overtime

It is very hard to find good solutions on the long run. Some ideas such as job-sharing or early retirement are in discussion. But my opinion on that is that both, job-sharing and early retirement aren't the right way. Because if you share your job you won't earn enough money to afford the basics of life for your family.

Early retirement sounds nice but it means a huge amount of costs for all the other working people who have to pay for that. So this can't be the right way, I suppose.

A good solution would be the attendance of further training courses, so that unemployed people are trained to find a new job and learn new skills. Only problem about that are the costs, which are very high and the question is who is going to pay them.