CAIE IGCSE Economics 4.6 Employment and Unemployment Topic Practice

B

C

Identify two types of unemployment.

Two from:

Frictional (1) structural (1) cyclical / demand deficient (1)

2

If more than two types given, consider the first three.

Also accept voluntary unemployment, involuntary unemployment, seasonal, classical, casual, regional, technological. Accept demand-deficient as an alternative to cyclical.

Explain two disadvantages workers may experience as a result of losing their jobs.

Logical explanation which might include:

Loss of income (1) resulting in lower living standards / lower quality of life / poverty / inability to buy necessities / lower purchasing power / lower spending / lower consumption / lower spending on a particular good or services e.g. education/healthcare/housing/holidays (1).

Loss of skills (1) may need to gain new skills / as miss out on training / make it more difficult to get another job / lower paid job / reduced mobility of labour (1).

May be more likely to get into debt (1) harder to repay any past loans (1).

Harder to get a loan (1) banks may not expect them to be able to repay loan (1).

Loss of fringe benefits (1) example e.g. health insurance / home (1).

Less attractive to future employers / bad reputation (1) make it more difficult to get another job (1).

Mental health problems / stress / illness / divorce (1) loss of self-esteem / loss of self-confidence / making it more difficult to get another job / reduced life expectancy / due to difficulty/time to find another job (1).

May have to sell possessions (1) to gain money / to meet bills (1).

Demotivation (1) give up looking for work / become a discouraged worker / become voluntarily unemployed (1). Reduced ability to save (1) reduced ability to cope with unexpected events/ to finance e.g. education/ healthcare / retirement (1).

4

One mark each for each of two reasons identified and one mark each for each of two explanations.

If more than two reasons given, consider the first three.

Reward 'making it more difficult to get another job' only once.

Award up to 4 marks for logical reasons why it should, which may include:

- can enable young workers to develop their skills / raise their productivity (1)
increase their confidence / motivation to get a job / get higher paid jobs (1)
young people may make mistakes and cost firm money while being trained (1)
- can increase the chances of young people gaining a job (1)
reduce unemployment (1)
reduce the cost of unemployment benefits (1)
reduce future training costs (1)
increase tax revenue (1)
leads to economic growth (1).

Award up to 4 marks for logical reasons why it should not, which may include:

- the quality of the work experience may not be good (1)
the young may be given unskilled jobs (1)
poor working conditions / not regulated (1)
- opportunity cost [implied] (1)
government spending could be used to e.g. improve state education (1)
government incurs additional expenditure / raises taxes to pay for it (1)
the young may have been employed by the private sector without payment by the government (1)
- it may reduce the efficiency of private firms (1)
reduce their output (1)
firms may be corrupt (1).

Apply this example to all questions with the command word DISCUSS

(1(g), 1(h), 2(d), 3(d), 4(d) and 5(d))

Each point may be credited only once, on either side of an argument, but separate development as to how/why the outcome may differ is rewarded.