Group items tagged

As can be seen, there has been a drop in unemployment in the UK, falling to 2.58 million people and is shown visually on the graph. There has been a drastic change in the unemployment of 16 to 24 year olds, which will have positive outcomes in the long-run. With less young people being unemployed, they are gaining on vital years of learning that they would have previously missed out on if they had not been employed. In order to gain experience and be better workers in the future, they would need to be employed as soon as possible, and with this happening it will affect the workforce later on as they have developed useful skills to benefit their work.  Once older workers have retired, there will now be people to fill the roles of these workers. With the Olympic Games providing the boost to the economy that is greatly needed, employment is starting to rise again; however, there is the worry that this will only have an impact in the short-run, with there being temporary jobs for the unemployed that will soon no longer be needed. If this happens there could be a rise followed by a sudden drop in employment, so there is a question of whether it will benefit the unemployed at all.

Data shows that contraction in the UK has not dropped by as much as it was expected to, so could this mean that they are reaching a trough and the recession is coming to an end? Inflation is down and unemployment is falling, although the productive capacity of the economy has been affected because of a shift to part-time work. The UK  has had a flat economy over the past two years, so the lower than expected changes in GDP do not change that it is in a recession. 

This article discusses how Australia's unemployment rate fell unexpectedly. Unemployment decreased to 5.1% from 5.2% in July in a time in which a Bloomberg survey of 23 economists predicted it to increase to 5.3%. The reason given for this is that the labor participation rate slumped to lowest level in more than five years, a sign workers looking for jobs have exited the labor force. Unemployment had been expected to rise - although the economy grew by about 4% on the back of a strong resource industry, a stronger currency and slower global growth led to job reductions at companies including Ford and Qantas. Employment in the states of Victoria and South Australia dropped 14,800 and 9,000 respectively, but increased by 6,900 in Western Australia and 5,800 in Queensland which are centers of the resource industry.

The article describes how unemployment in Argentina has dropped below 7% for the first time in a long time. The decreased unemployment is due to an increase in the country's exports and an increase in national aggregate demand. Both of these things would cause an increase in aggregate supply, which in result would increase the aggregate supply of labor, causing the unemployment rate to decrease. However, this is only seen as a short term change, as the export are expected to decrease due to the economic crisis in Europe, and the increasing movement of production to china, and the growing competition from Chinese produced goods, because of the cheaper prices. This would cause aggregate demand in Argentina to decrease, which would cause a response from the short run aggregate supply, in the form or a decrease. This would again cause the aggregate supply of labor to fall back down again, resulting in the unemployment rate rising again.

The article explains how the German retail sales decreased by 0.9 percent in July, as a result of the increasing fuel prices.  The inflated prices of fuel have caused the consumption on other goods and services of households in Germany to decrease. Consumption is one of the four factors that affects the aggregate demand or the total demand for final goods and services in an economy at a given time and price level, in an economy. Therefore, if consumption of households decreases the aggregate demand in an economy also decreases. Hence, the aggregate demand in Germany's economy has decreased significantly and therefore their retail sales have also decreased, by 0.9 percent as the article claims. This is because if consumption is lower than the units of output sold are also lower. 

Germany's unemployment rates have been rising as firms are dropping their demand for labor. In many cases, firms are not firing workers, but they are also not hiring new workers, which causes an increase in unemployment rates as the labor force increases. Although Germany's unemployment remains low (5.4%) compared to other members of the European Union, the rise in unemployment rates is worrying as it could lead to a fall in aggregate demand and lead to recession. Right now, Germany is still growing at a rate of over 1% per year, which is why the higher unemployment rates are considered seasonal, as mentioned in the article. However, if people start losing jobs and there is no labor demand in the long-run, this could trigger a recession and a permanent cyclical unemployment.