Rate Of Unemployment In Australia – Last 5 Years

Critical Analysis

Discuss about the Rate Of Unemployment In Australia.

This assignment is about the rate of unemployment in Australia in the last 5 years. Unemployment is a situation when a person, willing to work doesn’t get work because of the unavailability of the jobs in the economy. In simpler words unemployment is the number of unemployed people in the economy (Hundal, 2010). A country’s financial stability is measured by various factors one of them is the factor of unemployment, lower the rate of unemployment higher the financial stability of the nation. In this assignment we are going to discuss about the last 5 year records of the unemployment in the Australia. According to the latest news release, the unemployment rate slightly fell down at 5.6% in august 2017 (TE Economics, 2015). Unemployment is considered to be one of the most serious problems in any country that affects the performance of the nation as a whole. A major reason for the unemployment is the growth of population, in Australia population is increasing at a low pace but it is increasing, in 1960 the population was around 10 million, which is now 24.13 million. Every nation wants to deal with the situation of unemployment, but mostly countries fails to cope up with these situations as this problem seems to be small but when we go into the depth of it, it becomes bigger and bigger. However it is not impossible to put an end on this problem, a nation needs to work hard on its policies and economy so that it gets foreign direct investment as well as its own funds to strengthen the infrastructure that will ultimately put an end on the cause of unemployment (Mark, 2013). In this assignment we are going to talk about such policies and strategies which can help in curbing the unemployment.

Now in this section of the project we are going to discuss in detail the issue of unemployment in the last 5 years in Australia. Unemployment is like a deadly disease that any country wants to get rid of. Not even a single country in the whole world has achieved an economy which says full employment is there (Cruise, 2017). However it is almost an impossible thing to do, as unemployment grows as the population grows. If we talk about Australia then Australian population is 24.13million in 2017 and the rate of unemployment is somewhere around 5.6% in august 2017 according to a national news channel. If we talk about the trend of unemployment in Australia in the last 5 years, then it won’t be wrong saying that in the year 2012 the unemployment rate was as low as 5% (TE Economics, 2015). The unemployment rate is going to stand at 5.40% by the end of this quarter according to an economics website, and by the end of this year this rate will slightly rise to 5.60%. In the year 2014 and 2015 the unemployment rate was as high as 6.1%, these are the two years in the last five years when the unemployment rate was really high. Most of the eminent economists of the world believe that the situation of full employment is neither practical nor desirable. There are sub-types of unemployment that are explained below (Study you and me, 2014):

• Frictional Unemployment: Frictional unemployment is the one that can’t be avoided at any cost, and it does not harm to the economy of the country. Frictional unemployment is an unemployment which occurs when the workers leave their current job in search for looking up the better job. As said above frictional unemployment is not harmful and it would be appropriate to say that it is required in the economy.
• Natural Unemployment: Natural unemployment is a combination of frictional, structural and surplus unemployment. Natural employment is that part of an economy which will stay there forever; it can’t be put to zero. Even the most powerful economies of the world have natural unemployment in their economic structures.
• Structural Unemployment: Structural unemployment is a part of natural unemployment, it occurs when the workers don’t have the skill that the employer wants in them and robots or machines are chosen over them by the employer in the working process.
• Long Term Unemployment: Most of the peoples fall in this category. People who are continuously searching for jobs for more than a period of 27 weeks fall into this category. Sadly this situation leads to anger and depression into the peoples which results in the rise of the unemployment and low standard of livings.
• Cyclic Unemployment: This type of unemployment arises when the recession or contraction phase of business hits the market or the economy and the employer starts cutting out their workforce. Cyclic unemployment is not a part of natural unemployment.
• Real Unemployment: Real unemployment is not considered to one of the types or sub types of the unemployment. The term real unemployment has been given by the BLS.

The Cost of unemployment

The unemployment rate in Australia in the last 5 years has been shown through the help of a graph that is presented below, it will not only help the audience to understand it but also it will give all the little details about the unemployment rate in Australia (Melinda Therisa, 2017).

Now as the above graph depicts the unemployment rate in the Australia for the last 5 years. In this the year the unemployment rate was as low as 5%, and then it gradually increased by time and each year it increased at a low pace and in the year 2015 the unemployment rate was as high as 6.3, which the Australian economy managed to bring down to 6% by the start of 2016 and further it slipped to 5.6% in the year 2017. Unemployment rates as set by the Federal Reserve’s are between 5-5.5% that are considered to be the ideal unemployment rate even for the strongest economies of the world (Reserve, 2017). If below or above the employment rates falls or rise then the government of the nation needs to interfere to handle the situation to maintain the economic stability. 

Unemployment is considered to be a really bad thing in the economy of a nation. Most of the eminent economists of the world have considered the unemployment as an important component of an economy as it can’t be totally elevated from the economy (Jaspal, 2014). Even the most powerful of the nations suffers from the unemployment. The cost of unemployment is different to the different sections of the society.

• The Cost to the Individual: When an individual suffers from the loss of his/her job due to recession or other reasons, it will not hard to imagine the situation. From the very first point when the individual lost his job, his savings, family, daily routine everything will get disturb. If this situation stays for very long then it will ultimately leads to an individual where he will deny for the education opportunities for his children’s and other basic facilities as he will have no money to sponsor anything.
• The Cost to the Society: When there is prolonged unemployment is in the society then it will not only lowers the standard of living of the people but it will also increase the crime rates in the country. When people will have no jobs and no money they will automatically fall for wrong things in order to feed their empty stomachs and pockets. This situation will not only harm the society financially but it will create a poor image of the nation at an international platform.
• The Cost to the Country: When the level of unemployment increases, the taxes that the government of a country receives reduces. This will ultimately results in government borrowing funds from other countries and financial institutions(Tendulkar, 2014).

Unemployment, as said is not possible to be erased from the economy, around 5-5.5% rate of unemployment is ideal for every economy. The bad or adverse effects of the unemployment are as under (Harlod, 2012):

• Abuse of Labor: When the economy of the nation is hit back with a high of unemployment then the big companies or even the mid or small scale firms starts exploiting the labor by hiring them on very low wages that are even against the government standards for low wages.
• Industrial Disputes: Industrial disputes is the another bad effects of the unemployment. When the employer fires his employees due to recession, it leads to industrial disputes as sometimes the employee’s moves to employee’s association or tribunals that look after the interest of the employees(Nanto, 2014).
• Political Instability: The rise of unemployment not only leads to disputes but also it creates political instability. When the unemployment rate increases the people falling in the same category starts cursing the political or government parties. This leads to political instability in the country(Loius, 2017).      

• Focusing on young people: The government of a country for controlling or elevating unemployment to a great extent must focus on its young peoples. As they are the one who have the future of the country in their hands. Focusing on young people not only control the unemployment but it will also grow the GDP of a nation as the young people’s are willing to do more and more work efficiently and effectively that will help the nation to grow on an international standard(Marky, 2016).
• Starting your own business: As the unemployment is growing day by day even in strongest of the economies are unable to cope up with the unemployment. The government of the nations is now promoting self employment by giving tax rebates if a person opens up his/her own business. In India, if an individual or a group of people opens up a start up then they needs not to give any tax on the earning of the business for 3 years. By doing this it will curb unemployment by creating more job opportunities.
• Improving education & skills: The government of a nation can provide the benefits of improving education and skills of the unemployed educated peoples. Most of the countries have various centers for skill and education development. The local government authorities can ask the people of their local province to join these courses so that it helps them in finding the right jobs for them (Berth, 2017).
• Seasonal Unemployment: The industrialists who are into the manufacturing business of those products or services that are seasonal and by the end of their season they cut down their workforce must opt some other manufacturing process in the slack reason, so that the country do not face the problem of unemployment at least from their end.
• Controlling population: The major cause of unemployment in any country is its population. Bigger the population biggest will be the unemployment. The government should also concentrate on the techniques and schemes to control population, cause large population does not only leads to unemployment but also to many other unwanted problems that lowers the stand of a nation on international levels.
• Temporary work: If a nation faces unemployment problem more than any other country than it must introduce the scheme of providing temporary work to the person till he/she doesn’t gets a suitable job for themselves. These temporary jobs can be provided at low wages that at least allow these temporary workers to fulfill their daily needs of food and shelter.
• Reducing age of retirement: In most of the countries the age of retirement is around 60-65 and in few of the countries it has been reached to 68. Such long age of retirement also cause unemployment in an economy because the newer peoples don’t get chance to work with government or other beneficial departments of the country. A government of a nation must creates a policy that will not only reduces the age of the retirement but it also makes sure that the recruitments for the newer peoples is done timely so that the opportunities to the youth can be given regularly and timely(Jessica, 2014).
• Illegal Immigration: When a nation faces the problem of illegal immigration, it not only stops at the immigration but they start doing the jobs at very low wages that leads to the loss of jobs to the local peoples. The freshest example of this kind of problem can be seen in Europe. Most of the European countries are facing this problem; Italy, U.K, Finland, Greece and Spain are few examples of such countries that are facing huge illegal immigrant’s problems(kaneru, 2008).   

Conclusion

After observing all the facts and information given above in the assignment, a detailed and a brief conclusion have been written here to give a final judgment about the unemployment in Australia in the last 5 years. According to the national surveyors the youth unemployment in Australia is only around 13.5% which way less than any other country of the world. Even the normal rate of unemployment in Australia is at 5.40%, it will grow to 5.60% by the end of this quarter and the Australian economy has worked really hard to maintain this rate of unemployment. As per the Federal Reserve’s the ideal unemployment rate is between 5-5.50%, which Australia has maintained for a long time and the forecast of Australian unemployment says that it will be remain stable by 2020. Australia is performing well at international level and sooner or later it will reduce the unemployment rate from 5.60% to 5%. Most of the world’s eminent economists say that it is not at all possible to totally elevate the unemployment and it is not at all recommendable. In the year 1953 the unemployment rate went down to 2.3% after the great Korean War. After which the economy fell down very badly which resulted in the hike of unemployment rate to an unimaginable point. Australian economy is capable of coping up with unemployment and it won’t be wrong to say that the Australian economy is currently at an ideal state of unemployment.       

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