structural unemployment


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Related to structural unemployment: Cyclical unemployment, Seasonal unemployment, Open Unemployment, Disguised unemployment

Structural Unemployment

Unemployment that results from a change in the way the local or national economy functions. For example, suppose the economy in a region is heavily dependent on exploiting a single, natural resource. If that resource is entirely consumed, the trained and untrained workers working on exploiting it will find themselves subject to structural unemployment, since there are no other companies exploiting that natural resource because there is no more natural resource. On the plus side, these gaps in the economy can open up new opportunities. See also: Retraining.

structural unemployment

see UNEMPLOYMENT, STRUCTURE OF INDUSTRY.

structural unemployment

the long term UNEMPLOYMENT caused by the decline of certain industries and changes in production processes. It occurs where changing demand patterns in an economy dislocate existing production patterns to the extent that labour becomes redundant. This is a long-term phenomenon requiring the work force to seek other jobs outside the declining industries, possibly in a different part of the country. The problem is one that most governments have had to deal with, for example, the decline in the heavy engineering industries, steel and shipbuilding, in the north of England and in Scotland. Technological change and foreign competition forced the reduction in demand for goods associated with those industries, which resulted in mass unemployment of labour. Countering such unemployment requires extensive occupational retraining programmes for the displaced workers, assistance with moving to new areas where jobs are available, and financial inducements to encourage new growth industries to move to regions blighted by concentrations of declining industries. See REGIONAL POLICY, DEINDUSTRIALIZATION, SUPPLY-SIDE ECONOMICS.
References in periodicals archive ?
Persistent structural unemployment that penalizes those with higher education creates the conditions for "brain drain" while also creating disincentives for continued education.
Long-term unemployment may result in structural unemployment if workers' skills erode.
As the number of jobs lost in comparison with the pre-crisis employment trend continues to increase and structural unemployment remains a major problem, policymakers need to implement more supportive macroeconomic policies and active labour market policies," said Matthias Kempf, the UN's team leader for the report.
Birmingham has a long-term structural unemployment problem and there is a need to focus on getting apprentices into business.
Reducing Structural Unemployment and Driving Innovation Requires a New Approach to Skills development
Long-term job loss, structural unemployment, unusual seasonality and below-average compensation all combine to paint a difficult picture of the local labor market and economy.
However, he acknowledged several negative factors impacting the economy including lack of resources available to fund public expenditures, increase in internal and external debt, structural unemployment and problems associated with domestic and international migration.
On the other hand structural unemployment (Lalive, 2007; Mondschean & Oppenheimer, 2007; Wood, 1988; Standing, 1983) is normally applied to people who lose their job because the job ceases to exist (say due to technological change).
Disintermediation, which is part of structural unemployment, is another area where jobs are going away, resulting in displaced workers.
As a small open economy without an exchange rate instrument to mitigate shocks, it is also essential that collective bargaining framework is improved in a manner that meaningfully addresses high structural unemployment and ensures changes in wages are commensurate with those in productivity.
Structural imbalance between the pattern of labor supplied and demanded yields excess unemployment, which they call "structural unemployment" More precisely, they specify that structural unemployment exists when, given the configuration of vacancies, it would be possible to reduce unemployment (increase the job hiring rate) by moving an unemployed worker from one sector to another.
According to the study's authors, the main reason for the extreme level of social inequality and structural unemployment, especially among young people, is a socially selective and qualitatively inadequate education system.

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