Macroeconomics › Section S · Macroeconomic policy around the world › Topic S.3
Causes of unemployment around the world
An unemployment rate of 5% can mean a mild recession in one country and a labour market working normally in another, while a rate of 3% can hide millions of people scraping by. This topic sorts out the causes of joblessness in rich, middle-income and poor economies, and the policies that fit each.
In this topic
- One word, different problems
- Rich economies: cyclical or natural
- Why natural rates differ
- Worked example: a 50-worker rule
- Low unemployment, poor jobs
- The informal economy
- The Lewis dual-sector model
- Worked example: moving surplus workers
- South Africa: a structural problem
- Common mistakes to avoid
- Key takeaways
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