Question

The country of Eastralia is experiencing the following unemployment: (i) 1750 seasonal workers harvesting fruit have finished picking for the season. (ii) 800 motor vehicle workers have been retrenched because employers have decided to reduce production due to a fall in demand for motor vehicles. (iii) 250 skilled technicians are unemployed because their electrical mechanical skills have become redundant as firms have re-equipped with electronically advanced controlled equipment. (iv) 150 skilled workers are unemployed as a result of their firm losing an export contract to a competitor in another country who has recently installed new technologically advanced production methods. (v) Because they are convinced that no work exists for them in a depressed economy, 370 people aged over 55 years who are skilled have ceased looking for employment

Answer 1

(i) It is frictional unemployment,

(ii) It is cyclical unemployment,

(iii) It is structural unemployment,

(iv) It is structural unemployment,

(v) These people are not counted as a part of the labor force.