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11 Jan 2026

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Understanding Unemployment in Economics A Level

Understanding unemployment is crucial for grasping how economies function and... Show more

# measures of unemployment:
clalmant count:
- number of people receiving benefits for being unemployed
110 & labour force survey:
- employed

Measures of Unemployment

Ever wondered how economists actually count unemployed people? There are two main methods, and they don't always give the same answer.

The claimant count simply tracks people receiving unemployment benefits. It's straightforward but misses those who aren't eligible for benefits yet are still looking for work. Meanwhile, the Labour Force Survey (LPS) takes a broader approach by surveying households directly.

The LPS categorises people into three groups: employed (anyone doing more than one hour of paid work weekly), unemployed workingagepeoplewithoutjobsbutactivelyseekingworkworking-age people without jobs but actively seeking work, and inactive (those not looking for work at all). This survey often captures people missed by the claimant count, including those working in the hidden economy.

Key rates you need to know: The unemployment rate equals unemployed people divided by economically active people employed+unemployedemployed + unemployed × 100. Don't confuse "workless" unemployed+inactiveunemployed + inactive with "unemployed" - they're different measures that tell different stories about the job market.

Quick Tip: Remember that someone can be without a job but not count as unemployed if they're not actively seeking work - they'd be classified as inactive instead.

Types and Causes of Unemployment

Not all unemployment is the same - there are several distinct types, each with different causes and solutions.

Frictional unemployment happens when people move between jobs - it's actually a sign of a healthy, dynamic economy. Structural unemployment is trickier, splitting into occupational (workers lack skills for available jobs) and geographical (workers won't relocate for work). Seasonal unemployment affects industries like tourism or agriculture that depend on specific times of year.

The most serious type is cyclical unemployment, caused by lack of demand across the entire economy during recessions. There's also real wage unemployment when wages are set too high, creating excess labour supply, and casual unemployment affecting contract workers between assignments.

Under-employment is becoming increasingly important - this includes people stuck in part-time or zero-hour contracts when they want full-time work, or graduates working in jobs that don't match their qualifications. It typically rises during recessions as firms cut hours rather than make redundancies.

Remember: During economic downturns, you'll often see multiple types of unemployment occurring simultaneously, making recovery more complex.

Migration, Skills, and Economic Impact

Migration patterns significantly affect unemployment rates, though not always in ways you might expect.

Increased migration generally creates more jobs overall because immigrants spend money in the local economy, generating employment opportunities. However, it can also increase labour supply, potentially lowering wages for existing workers. The net effect depends largely on whether migrants' skills complement or compete with local workers' abilities.

Skills mismatches create long-term challenges as economies evolve and require higher skill levels. Migrant workers may fill skill shortages in some sectors whilst other workers become long-term unemployed if their skills become obsolete. This highlights why retraining and education policies matter so much.

The impacts of unemployment ripple through society: workers lose income and skills, firms face reduced demand and smaller talent pools, consumers have fewer choices as businesses close, and governments see falling tax revenue alongside rising welfare costs. Most seriously, high unemployment represents a massive waste of potential national output that benefits no one.

Think About It: Unemployment isn't just about individual hardship - it represents lost economic potential that could have benefited everyone through increased production and innovation.



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Just amazing. Let's me revise 10x better, this app is a quick 10/10. I highly recommend it to anyone. I can watch and search for notes. I can save them in the subject folder. I can revise it any time when I come back. If you haven't tried this app, you're really missing out.

Basil

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This app has made me feel so much more confident in my exam prep, not only through boosting my own self confidence through the features that allow you to connect with others and feel less alone, but also through the way the app itself is centred around making you feel better. It is easy to navigate, fun to use, and helpful to anyone struggling in absolutely any way.

David K

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Sudenaz Ocak

Android user

In school I was really bad at maths but thanks to the app, I am doing better now. I am so grateful that you made the app.

Greenlight Bonnie

Android user

very reliable app to help and grow your ideas of Maths, English and other related topics in your works. please use this app if your struggling in areas, this app is key for that. wish I'd of done a review before. and it's also free so don't worry about that.

Rohan U

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I know a lot of apps use fake accounts to boost their reviews but this app deserves it all. Originally I was getting 4 in my English exams and this time I got a grade 7. I didn’t even know about this app three days until the exam and it has helped A LOT. Please actually trust me and use it as I’m sure you too will see developments.

Xander S

iOS user

THE QUIZES AND FLASHCARDS ARE SO USEFUL AND I LOVE Knowunity AI. IT ALSO IS LITREALLY LIKE CHATGPT BUT SMARTER!! HELPED ME WITH MY MASCARA PROBLEMS TOO!! AS WELL AS MY REAL SUBJECTS ! DUHHH 😍😁😲🤑💗✨🎀😮

Elisha

iOS user

This apps acc the goat. I find revision so boring but this app makes it so easy to organize it all and then you can ask the freeeee ai to test yourself so good and you can easily upload your own stuff. highly recommend as someone taking mocks now

Paul T

iOS user

The app is very easy to use and well designed. I have found everything I was looking for so far and have been able to learn a lot from the presentations! I will definitely use the app for a class assignment! And of course it also helps a lot as an inspiration.

Stefan S

iOS user

This app is really great. There are so many study notes and help [...]. My problem subject is French, for example, and the app has so many options for help. Thanks to this app, I have improved my French. I would recommend it to anyone.

Samantha Klich

Android user

Wow, I am really amazed. I just tried the app because I've seen it advertised many times and was absolutely stunned. This app is THE HELP you want for school and above all, it offers so many things, such as workouts and fact sheets, which have been VERY helpful to me personally.

Anna

iOS user

Best app on earth! no words because it’s too good

Thomas R

iOS user

Just amazing. Let's me revise 10x better, this app is a quick 10/10. I highly recommend it to anyone. I can watch and search for notes. I can save them in the subject folder. I can revise it any time when I come back. If you haven't tried this app, you're really missing out.

Basil

Android user

This app has made me feel so much more confident in my exam prep, not only through boosting my own self confidence through the features that allow you to connect with others and feel less alone, but also through the way the app itself is centred around making you feel better. It is easy to navigate, fun to use, and helpful to anyone struggling in absolutely any way.

David K

iOS user

The app's just great! All I have to do is enter the topic in the search bar and I get the response real fast. I don't have to watch 10 YouTube videos to understand something, so I'm saving my time. Highly recommended!

Sudenaz Ocak

Android user

In school I was really bad at maths but thanks to the app, I am doing better now. I am so grateful that you made the app.

Greenlight Bonnie

Android user

very reliable app to help and grow your ideas of Maths, English and other related topics in your works. please use this app if your struggling in areas, this app is key for that. wish I'd of done a review before. and it's also free so don't worry about that.

Rohan U

Android user

I know a lot of apps use fake accounts to boost their reviews but this app deserves it all. Originally I was getting 4 in my English exams and this time I got a grade 7. I didn’t even know about this app three days until the exam and it has helped A LOT. Please actually trust me and use it as I’m sure you too will see developments.

Xander S

iOS user

THE QUIZES AND FLASHCARDS ARE SO USEFUL AND I LOVE Knowunity AI. IT ALSO IS LITREALLY LIKE CHATGPT BUT SMARTER!! HELPED ME WITH MY MASCARA PROBLEMS TOO!! AS WELL AS MY REAL SUBJECTS ! DUHHH 😍😁😲🤑💗✨🎀😮

Elisha

iOS user

This apps acc the goat. I find revision so boring but this app makes it so easy to organize it all and then you can ask the freeeee ai to test yourself so good and you can easily upload your own stuff. highly recommend as someone taking mocks now

Paul T

iOS user

 

Economics

313

11 Jan 2026

1 page

Understanding Unemployment in Economics A Level

Understanding unemployment is crucial for grasping how economies function and what affects people's ability to find work. This topic covers how we measure unemployment, different types of joblessness, and the wide-ranging impacts on workers, businesses, and society as a whole.

# measures of unemployment:
clalmant count:
- number of people receiving benefits for being unemployed
110 & labour force survey:
- employed

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Measures of Unemployment

Ever wondered how economists actually count unemployed people? There are two main methods, and they don't always give the same answer.

The claimant count simply tracks people receiving unemployment benefits. It's straightforward but misses those who aren't eligible for benefits yet are still looking for work. Meanwhile, the Labour Force Survey (LPS) takes a broader approach by surveying households directly.

The LPS categorises people into three groups: employed (anyone doing more than one hour of paid work weekly), unemployed workingagepeoplewithoutjobsbutactivelyseekingworkworking-age people without jobs but actively seeking work, and inactive (those not looking for work at all). This survey often captures people missed by the claimant count, including those working in the hidden economy.

Key rates you need to know: The unemployment rate equals unemployed people divided by economically active people employed+unemployedemployed + unemployed × 100. Don't confuse "workless" unemployed+inactiveunemployed + inactive with "unemployed" - they're different measures that tell different stories about the job market.

Quick Tip: Remember that someone can be without a job but not count as unemployed if they're not actively seeking work - they'd be classified as inactive instead.

Types and Causes of Unemployment

Not all unemployment is the same - there are several distinct types, each with different causes and solutions.

Frictional unemployment happens when people move between jobs - it's actually a sign of a healthy, dynamic economy. Structural unemployment is trickier, splitting into occupational (workers lack skills for available jobs) and geographical (workers won't relocate for work). Seasonal unemployment affects industries like tourism or agriculture that depend on specific times of year.

The most serious type is cyclical unemployment, caused by lack of demand across the entire economy during recessions. There's also real wage unemployment when wages are set too high, creating excess labour supply, and casual unemployment affecting contract workers between assignments.

Under-employment is becoming increasingly important - this includes people stuck in part-time or zero-hour contracts when they want full-time work, or graduates working in jobs that don't match their qualifications. It typically rises during recessions as firms cut hours rather than make redundancies.

Remember: During economic downturns, you'll often see multiple types of unemployment occurring simultaneously, making recovery more complex.

Migration, Skills, and Economic Impact

Migration patterns significantly affect unemployment rates, though not always in ways you might expect.

Increased migration generally creates more jobs overall because immigrants spend money in the local economy, generating employment opportunities. However, it can also increase labour supply, potentially lowering wages for existing workers. The net effect depends largely on whether migrants' skills complement or compete with local workers' abilities.

Skills mismatches create long-term challenges as economies evolve and require higher skill levels. Migrant workers may fill skill shortages in some sectors whilst other workers become long-term unemployed if their skills become obsolete. This highlights why retraining and education policies matter so much.

The impacts of unemployment ripple through society: workers lose income and skills, firms face reduced demand and smaller talent pools, consumers have fewer choices as businesses close, and governments see falling tax revenue alongside rising welfare costs. Most seriously, high unemployment represents a massive waste of potential national output that benefits no one.

Think About It: Unemployment isn't just about individual hardship - it represents lost economic potential that could have benefited everyone through increased production and innovation.

We thought you’d never ask...

What is the Knowunity AI companion?

Our AI Companion is a student-focused AI tool that offers more than just answers. Built on millions of Knowunity resources, it provides relevant information, personalised study plans, quizzes, and content directly in the chat, adapting to your individual learning journey.

Where can I download the Knowunity app?

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Is Knowunity really free of charge?

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Most popular content in Economics

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Can't find what you're looking for? Explore other subjects.

Students love us — and so will you.

4.9/5

App Store

4.8/5

Google Play

The app is very easy to use and well designed. I have found everything I was looking for so far and have been able to learn a lot from the presentations! I will definitely use the app for a class assignment! And of course it also helps a lot as an inspiration.

Stefan S

iOS user

This app is really great. There are so many study notes and help [...]. My problem subject is French, for example, and the app has so many options for help. Thanks to this app, I have improved my French. I would recommend it to anyone.

Samantha Klich

Android user

Wow, I am really amazed. I just tried the app because I've seen it advertised many times and was absolutely stunned. This app is THE HELP you want for school and above all, it offers so many things, such as workouts and fact sheets, which have been VERY helpful to me personally.

Anna

iOS user

Best app on earth! no words because it’s too good

Thomas R

iOS user

Just amazing. Let's me revise 10x better, this app is a quick 10/10. I highly recommend it to anyone. I can watch and search for notes. I can save them in the subject folder. I can revise it any time when I come back. If you haven't tried this app, you're really missing out.

Basil

Android user

This app has made me feel so much more confident in my exam prep, not only through boosting my own self confidence through the features that allow you to connect with others and feel less alone, but also through the way the app itself is centred around making you feel better. It is easy to navigate, fun to use, and helpful to anyone struggling in absolutely any way.

David K

iOS user

The app's just great! All I have to do is enter the topic in the search bar and I get the response real fast. I don't have to watch 10 YouTube videos to understand something, so I'm saving my time. Highly recommended!

Sudenaz Ocak

Android user

In school I was really bad at maths but thanks to the app, I am doing better now. I am so grateful that you made the app.

Greenlight Bonnie

Android user

very reliable app to help and grow your ideas of Maths, English and other related topics in your works. please use this app if your struggling in areas, this app is key for that. wish I'd of done a review before. and it's also free so don't worry about that.

Rohan U

Android user

I know a lot of apps use fake accounts to boost their reviews but this app deserves it all. Originally I was getting 4 in my English exams and this time I got a grade 7. I didn’t even know about this app three days until the exam and it has helped A LOT. Please actually trust me and use it as I’m sure you too will see developments.

Xander S

iOS user

THE QUIZES AND FLASHCARDS ARE SO USEFUL AND I LOVE Knowunity AI. IT ALSO IS LITREALLY LIKE CHATGPT BUT SMARTER!! HELPED ME WITH MY MASCARA PROBLEMS TOO!! AS WELL AS MY REAL SUBJECTS ! DUHHH 😍😁😲🤑💗✨🎀😮

Elisha

iOS user

This apps acc the goat. I find revision so boring but this app makes it so easy to organize it all and then you can ask the freeeee ai to test yourself so good and you can easily upload your own stuff. highly recommend as someone taking mocks now

Paul T

iOS user

The app is very easy to use and well designed. I have found everything I was looking for so far and have been able to learn a lot from the presentations! I will definitely use the app for a class assignment! And of course it also helps a lot as an inspiration.

Stefan S

iOS user

This app is really great. There are so many study notes and help [...]. My problem subject is French, for example, and the app has so many options for help. Thanks to this app, I have improved my French. I would recommend it to anyone.

Samantha Klich

Android user

Wow, I am really amazed. I just tried the app because I've seen it advertised many times and was absolutely stunned. This app is THE HELP you want for school and above all, it offers so many things, such as workouts and fact sheets, which have been VERY helpful to me personally.

Anna

iOS user

Best app on earth! no words because it’s too good

Thomas R

iOS user

Just amazing. Let's me revise 10x better, this app is a quick 10/10. I highly recommend it to anyone. I can watch and search for notes. I can save them in the subject folder. I can revise it any time when I come back. If you haven't tried this app, you're really missing out.

Basil

Android user

This app has made me feel so much more confident in my exam prep, not only through boosting my own self confidence through the features that allow you to connect with others and feel less alone, but also through the way the app itself is centred around making you feel better. It is easy to navigate, fun to use, and helpful to anyone struggling in absolutely any way.

David K

iOS user

The app's just great! All I have to do is enter the topic in the search bar and I get the response real fast. I don't have to watch 10 YouTube videos to understand something, so I'm saving my time. Highly recommended!

Sudenaz Ocak

Android user

In school I was really bad at maths but thanks to the app, I am doing better now. I am so grateful that you made the app.

Greenlight Bonnie

Android user

very reliable app to help and grow your ideas of Maths, English and other related topics in your works. please use this app if your struggling in areas, this app is key for that. wish I'd of done a review before. and it's also free so don't worry about that.

Rohan U

Android user

I know a lot of apps use fake accounts to boost their reviews but this app deserves it all. Originally I was getting 4 in my English exams and this time I got a grade 7. I didn’t even know about this app three days until the exam and it has helped A LOT. Please actually trust me and use it as I’m sure you too will see developments.

Xander S

iOS user

THE QUIZES AND FLASHCARDS ARE SO USEFUL AND I LOVE Knowunity AI. IT ALSO IS LITREALLY LIKE CHATGPT BUT SMARTER!! HELPED ME WITH MY MASCARA PROBLEMS TOO!! AS WELL AS MY REAL SUBJECTS ! DUHHH 😍😁😲🤑💗✨🎀😮

Elisha

iOS user

This apps acc the goat. I find revision so boring but this app makes it so easy to organize it all and then you can ask the freeeee ai to test yourself so good and you can easily upload your own stuff. highly recommend as someone taking mocks now

Paul T

iOS user