3. The Debate

Divide into two teams (A and B) for a debate.

The debate will focus on the problem of how to reduce high production costs and improve the whole situation in the company.

The Teams:

Team A will argue in the necessity of reducing production costs.

Team B will argue against it.

Prepare your arguments. Appoint a moderator to lead the debate.

The Procedure:

1. Team A and Team B prepare their arguments in small groups, citing evidence from the text.

2. Teams A and B face each other for a debate.

3. Team A begins with a one-minute presentation.

2. Team B responds in one minute or less.

3. Continue in this fashion. A member of a team is not allowed to speak until someone from the opposite team has made a counterargument.

After the debate the moderator evaluates the strength of both arguments.

VI. Writing

Write an essay on the following topic.

Think of a task, such as washing a car or cooking a meal, which you have completed by yourself. Describe the task and the main steps you took to complete it. Consider how the marginal product would change if you had the help of one more person, two more people, and three more people.

Unit 7 Employment and Unemployment

I. Anticipating the Issue

Discuss your answers to the following questions.

1. What is employment? What is unemployment? Are there any countries with full employment?

2. What does high unemployment level indicate?

3. How does unemployment affect the country’s economy? Individuals?

II. Background Reading

Read the following text. Focus on the meaning of the boldfaced words. Determine whether what you anticipated coincides with the information of the text.

Employment and Unemployment

1. Types of Unemployment: After the Great Depression (1929-33), two major economic problems that world economies have been facing are Unemployment and Inflation. Expert economists advise government officials about the causes and cures of economic problems. One statistic they consider is the unemployment rate. This is the percentage of the civilian labour force without jobs but actively looking for work. High unemployment indicates that the economy is not doing well and human resources are being wasted. Therefore, low unemployment is a major goal in stabilizing the economy.

2. The public authority of any nation today has the primary responsibility of minimizing the level of unemployment and aiming for the full employment condition. This requires large-scale public spending on employment promotion schemes and on the payment of unemployment doles. So that this function can be performed promptly and satisfactorily, it is important that the information about unemployment conditions should be quickly available.

3. For most of the twentieth century, people often thought of “a job” (or at least a good job) as something you typically did Monday through Friday, 40 hours a week, for a wage or salary and benefits (such as health insurance and pension plans). People often expected to stay in the same job for years, or even decades. In recent years, it has become popular to talk about how employment is becoming more flexible.

4. Despite its name, full employment does not mean a zero unemployment rate. Instead, it means a level of unemployment in which none of the unemployment is caused by a decreased economic activity. Economists generally believe that full employment exists when unemployment rate is below 5 percent. Even in a healthy economy there is always some level of unemployment. Sometimes people become unemployed when they relocate or when they leave one job to try to find another job that suits them better. Sometimes the available jobs do not match up with the skills of the available workers. In other words, some amount of unemployment is inevitable.

5. Economists pay attention not only to the unemployment statistics, but also to the reasons for unemployment. Economists recognize the following main types of unemployment:

6. Frictional unemployment, temporary unemployment experienced by people changing jobs. It is a reflection of workers’ freedom to find the work best suited for them at the highest possible wage. Economists consider frictional unemployment normal and not a threat to economic stability.

7.Seasonal unemployment, unemployment linked to seasonal work. Demand for some jobs changes dramatically from season to season, resulting in seasonal unemployment.

8.Structural unemployment, a situation where jobs exist but workers looking for work do not have the necessary skills for these jobs. A dynamic economy will often create structural unemployment as businesses become more efficient and require fewer workers to create the same amount of output. There are a number of possible triggers for structural unemployment. New technology can replace human workers or require workers to retrain. New industries requiring specialized education can leave less well-educated workers out of work. A change in consumer demand can shift the type of workers needed. Offshore outsourcing – the contracting of work to suppliers in other countries – is another source of structural unemployment.

9.Cyclical unemployment, unemployment caused by a part of the business cycle with a decreased economic activity. It results when the economy hits a low point in the business cycle and employers decide to lay off workers. Workers who lose their jobs during a recession can have trouble finding new jobs because the economy as a whole is scaling back, and the demand for labour declines. When the economy picks up again, many workers are again able to find jobs.

10.Disguised Unemployment, a situation under which productivity of the working force is very low. This is because an excessive number of workers are employed than what is optimally desirable.

11. The duration of unemployment in these types ranges widely, but the average duration of unemployment is relatively short.

12. The impact of unemployment: Although some unemployment is unavoidable, excessive or persistent unemployment hurts the economy in several ways. It reduces efficiency, it hurts the least economically secure, it damages workers’ self-confidence.

Efficiency. Unemployment is inefficient. It wastes human resources, one of the key factors of economic growth.

Inequality. Unemployment does not follow equal opportunity rules. In an economic slowdown, those with the least experience lose their jobs first. Also, with fewer jobs available, people on the lower rungs of the employment ladder have less opportunity to advance.

Discouraged Workers. People who are unemployed – or underemployed – for long periods of time may begin to lose faith in their abilities to get a job that suits their skills. Potentially productive workers may give up their search for work. If they are underemployed, they may not be motivated to do their work best.

13. Whether an economy is able to generate and sustain “good jobs” depends on the whole institutional structure and dynamics of the national economy. The actions of business, governmental units, nonprofits (including unions, industry associations, and universities) and households all work together to determine the numbers and types of jobs that are generated, the number of workers in the labor force, and the skills with which workers are equipped. The responses of a country’s business leaders, policy makers, workers and consumers to natural resource constraints and to the challenges and opportunities offered by participation in global markets for goods, services, and finance have a further significant impact on the employment situation.