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Unemployment in Ecuador
“Unemployment is the situation in which people who having age, capacity and desire to work cannot obtain a job, finding themselves submissive to a situation of unavoidable idleness” (Anderson, 181). ... Due to the human costs derived from the deprivation and the feeling of rejection and personal failure, the quantity of unemployment is used habitually as a measurement of the welfare of workers. ... Unemployment is a concern of the entire world, but in Latin America it is a subject of daily life, that is why one of the main concerns of the governments is to fight unemployment or at least to maintain it at low levels. In order to understand unemployment in Ecuador in the last decade, and to determine the influence that has generated the adoption of the dolarization model it is necessary to understand the causes, effects, and the evolution of unemployment in our country.
Unemployment, as mentioned, is the involuntary leisure of a person who wishes to find a job; this common affirmation can be reached due to several causes. ... A second cause of unemployment is when the number of people who demands work exceeds the existing supplies of work, because the high real wages attract a greater number of unemployed people looking for work and disable to the companies to offer more jobs. A third cause of unemployment is the fluctuating demand of labor in certain regions, where the production depends on the time of the year. ... This kind of unemployment is the most harmful because those works are hardly ever recovered.
Unemployment is measured by the rate of unemployment. In general terms, the rate of unemployment is equal to total unemployment over the economically active population. The variations of the rate of unemployment are obtained by the procedure known by the name of random sampling of the population, which consist on dividing the population into groups according to their labor situation. The rate of unemployment is the percentage of the population that having willingness and age to work does not find a job, although they look for it actively. ... The rates of unemployment vary considerably by the changes in the volume of movement of the labor market, as result of technological changes, which leads to the change of labor from a company to another, from a sector to another and from a region to another; in addition this variation is due to age, sex and race. The global rate of unemployment is one of the more frequently used indicators to measure the global economic welfare, but given the dispersion of unemployment, it may be considered that it is an imperfect indicator of this welfare.
In order to be able to interpret in a better way unemployment, it will be useful to determine the existing types of unemployment in the market. The distinction and understanding of the types of unemployment helps to diagnose the health of the labor market. In general, there are three fundamental types of unemployment, which are, frictional, cyclical and structural. The frictional unemployment is the time workers take to change form one job to another or/and the time they are looking for it (Dornbush, 96). This kind of unemployment is usually generated when the economy is in a full employment status and it is not harmful at all. The cyclical unemployment is the difference between the global unemployment and the frictional unemployment; it occurs when the production is lower than full employment (Dornbush, 96). This kind of unemployment is normal in modern
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economies, because it appears when production decreases but it reduces or even disappears when the economy activity recovers its normal levels.
Approximate Word count = 2886
Approximate Pages = 11.5
(250 words per page double spaced)
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