Question

How does the factors of elasticity affect unemployment rates for the major of BUSINESS?

Answer 1

The unemployment rate means there is availability of the work force that wants to work however there are no jobs in an economy. The factor of elasticity that may impact the unemployment rates includes:

-- Specific abilities and educational requirement will make supply inelastic

-- Costly and lengthy period of training periods makes supply of labour inelastic

-- In the short run, the labour supply curve to a specific occupation tends to be relatively inelastic

-- The mobility of labour is has impact on the labour supply as in the short term it will tend to be relatively elastic

-- The work of vocational nature such as nursing, the workers are less sensitive to wage changes wages when deciding whether to work and the duration of hours to work