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Factors Causing High Unemployment
Topic Started: Feb 17 2012, 07:55 PM (737 Views)
Stoney
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Quote:
 
 Weak demand for goods and services as a result of the
recession and its aftermath, which accounts for about
two-and-a-half percentage points;

 Mismatches between the needs of employers and the
skills and location of the unemployed, which account
for about one-half of one percentage point;

 Incentives from extensions of unemployment insurance
for people to stay in the labor force and continue
searching for work, which account for about onequarter
of one percentage point; and

 Erosion of skills and the stigma attached to long-term
unemployment—that is, employers’ perception that
people who have been unemployed for a long time
would be low-quality workers—which together
account for about one-quarter of one percentage
point.


CBO
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ngc1514
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The big problem is too many people and too few jobs. From something I posted on another forum:

"The US labor force is projected to increase by 12.6 million over the 2008-2018 period reaching nearly 167 million by 2018." Link

Let's subtract 11 million from that number to give us an approximate labor force of 156 million in 2012. You can wiggle the number a bit if you like, it won't make much difference. The U-6 unemployment rate for January 2012 was 15.1% or about 23,500,000 unemployed. Add the 12.6 million joining the work force by 2018 and you end up with the necessity of creating over 36 million jobs in the next 6 years to reach the probably unattainable goal of zero unemployment. The problem lessens if 4% unemployment is acceptable in a healthy economy. That would result in about 6.6 million unemployed in 2018, but still leaves the problem of creating approximately 30 million jobs over the next 6 years.

A good plague might be the only viable solution.
Edited by ngc1514, Feb 17 2012, 09:22 PM.
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Chris
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Interesting, The world’s losing its workers. How will we compete? reports we're about to face a shortage of workers as people are having fewer children and the baby boomers hit retirement and die off.

Beats a plague! :-)

And just think, a shortage will drive demand and that higher wages and benefits.
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Thumper
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Rome had the same problem, so they built the Circus Maximus. Keep idle entertained and fed.
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I pretty much agree with Stoneys original post. I suspect the primary reason is unwillingness to re-locate to where the jobs are. As long as someone has a full belly they will resist doing that fro the most part.

For example, any American with good physical health or skills could easily find work in the oilfields in Canada and have little trouble getting permission to do so.
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Brewster
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Stoney, your post is very close to the truth.

And I agree with Telco - Alberta in general and the oilsands in particular are crying for people.

Anyone with a clean criminal record and a strong back can get a work visa at the drop of a hat, and make extremely good money (>$100K yr) within months of arriving.

And it's been that way for years.
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tomdrobin
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Lots of people have no useable skills, have criminal records (primarily drug related), and really aren't very trainable wether it be intelligence or motivation. Used to be we had lots of factory jobs and construction jobs they could do, but not anymore. What to do?
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Mountainrivers
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tomdrobin
Feb 18 2012, 05:23 AM
Lots of people have no useable skills, have criminal records (primarily drug related), and really aren't very trainable wether it be intelligence or motivation. Used to be we had lots of factory jobs and construction jobs they could do, but not anymore. What to do?
Hell, Tom, they can get a lawn mower and cut grass. I hear you can make a lot of money doing that. It doesn't have any benefits like insurance or sick days or vacations or 401Ks, but golly gee, you can work outdoors six or seven months a year and then try to find something like that that you could do in the winter when the grass isn't growing.
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Chris
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Why, just let the welfare state take them in.
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Stoney
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Jobs are available. Its a matter of how bad someone wants to work. To Eric's point I'd say that every new person produces new work and new opportunities for work. They need food and shelter. They have desires beyond food and shelter.

But to get the manufacturing jobs back we're going to have to compete for those jobs. We can subsidize them for a period, but we'll run out of money to do that eventually. If we have people who can stay home and earn more than they can in the labor market we'll have people stay home. If we have people who won't work here for less than $30 an hour (plus benefits) and then limit productivity so more than are needed are hired and people overseas will more for a third of that (or less) we'll be sending jobs overseas.
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