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Module 1: Economics and employment

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Limitations of the unemployment rate

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Economics - Limitations of the unemployment rate

Limitations of the unemployment rate

Employment statistics do not show the extent of underemployment. Some
people who work part-time want to work full-time, and some people are
working in jobs well below their qualifications, e.g. a lawyer working as a
sales assistant.

To be considered unemployed, a person must be actively seeking employment.

Many people, however, who have been unable to find work for a long time,
become so discouraged that they stop actively looking for a job. These
people are the hidden unemployed (sometimes called discouraged workers).
There are three main categories of hidden unemployed.

* Housewives whose families have grown up. They want a job but can't find
one, as they don't have the required skills.

* Older males who are forced into early retirement because employers are
unwilling to give them a job.

* Teenagers who can't find a job and so go back to school to improve
their qualifications.

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