Elements Of Economics

Topics: Unemployment, Economics, Frictional unemployment Pages: 7 (1465 words) Published: January 13, 2015
Introduction
Unemployment in Spain is a constant phenomenon that has worsened in recent years. As it stands, the youth unemployment level is now record high at 55%. According to the article, the economy has dived into a recession causing many workers to lose their jobs (Ainger, 2013).It is statistically proven that suicide rates are directly related to unemployment (Pritchard, 2014). Comparing mortality rates, it can be seen that rates are higher among unemployed young men and woman as to those who are employed (Hammarström, 2002). In this particular essay, we will discuss the issue of unemployment in Spain, the types of unemployment that the nation faces and also to look into the measures that the government is currently taking to curb the unemployment problem. Part 2

When unemployment is present, it means that the nation’s economy is not generating its full output because there are people who are unemployed. Gross Domestic Product (GDP) can be considered as one of the strongest tools for forecasting the unemployment patterns which have and will hit Spain (Miskolczi, Langhamrová, & Fiala, 2011). GDP is the monetary value of all final goods and services produced in a country in a single year (Case, Fair, & Oster, 2010). GDP, GDP growth rate, employment rates and the different types of unemployment are some concepts that will be used in analysing the unemployment in the country. There are three types of unemployment that can be used to analyse unemployment in Spain. These three are frictional, structural and cyclical unemployment. Each category describes the type of unemployment that a country can suffer from. Frictional unemployment occurs because people who have left their previous jobs needs time to look for another one. During this period of the time, the person is unemployed for only a short period of time, and this is not a problematic issue from an economic perspective. A good example of frictional unemployment is when a graduate steps into the workforce to look for a job. Structural unemployment occurs when there are changes in foreign competition and technology which alter the skillsets required to get the job done (Aysuna, Bouvetb, & Hoflera, 2014). This form of unemployment usually lasts longer than frictional unemployment. A good example of an example of structural unemployment is when the jobs of cashiers at supermarkets are replaced by self-check out registers, leading to unemployment due to technology advancement. Cyclical unemployment occurs during recessions because when demand of goods and services falls, some companies will cut down production and workers rather than reducing wages to tide over hard times (Aysuna, Bouvetb, & Hoflera, 2014). This will cause more workers to be present in the economy then available jobs resulting in unemployment. An example of cyclical employment can be seen in agricultural workers who are only hired during the summer harvest months, but who remain unemployed for the remainder of the year. Part 3

The issue of unemployment has been one of the most pressuring problems for most countries around the world. The current unemployment rate in Spain is 24.47 which is a drop in the 3 months towards June. It is the lowest rate since the second part of 2012 due to increased job creation in the service sectors. However, there is an increase in the youth unemployment rate from 53 percent to 53.5 percent in June 2014. It is indeed very shocking to see such a high percentage of unemployment among youths in Spain. In addition, the drop in the unemployment rate is only a gradual decline and it is still lingering at quite a high rate.

On the other hand, looking at Spain GDP's growth from 2012 till 2014, the graph indicates how fast the economy in Spain is growing now. GDP growth rate is an important indicator to determine the health of a country's economy. When a country’s economy is improving, the GDP growth rate will be positive indicating that businesses, jobs and...

References: Ainger, K. (2013). In Spain they are all indignados nowadays. United Kingdom: The Guardian.
Aysuna, U., Bouvetb, F., & Hoflera, R. (2014). An alternative measure of structural unemployment . Economic Modelling , 592-603.
Barysch, K. (2014). Can German apprenticeships fix Spain’s youth job crisis? World Economic Forum.
BBC News. (2012). Germany to help Spain give skills to jobless youths. BBC.
Bernal, J. A., Gasparrini, A., Artundo, C. M., & McKee, M. (2013). The effect of the late 2000s financial crisis on suicides in Spain: an interrupted time-series analysis. European Journal of Public Health .
Case, K., Fair, R., & Oster, S. (2010). Principles of Economics. Prentice Hall Business Publishing.
Deutsche Welle. (12 March, 2013). DW. Retrieved 8 September, 2014, from DEUTSCHE WELLE: http://www.dw.de/spain-spurs-spending-to-curb-rampant-youth-unemployment/a-16666033
Freeman, R
Hammarström, A. (2002). Health consequences of youth unemployment—review from a gender perspective. Social Science & Medicine , 699-709.
Miskolczi, M., Langhamrová, J., & Fiala, T. (2011). International Days Of Statistics and Economics. Unemployment and GDP , 407-413.
Pritchard, C. (2014). Is there a link between suicide in young men and unemployment? A comparison of the UK with other European Community Countries. The British journal of psychiatry , 750-756.
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