Unemployment

People write a lot about the correlation between unemployment and inflation but actually the sollutions to both are quite different. The short term correlation is this. If money supply is allowed to grow ( a way of taking money out of one persons pocket and puting it in another and therefore theft), then inflation will happen but this growth in money supply usually through the lending by banks at a rate lower than would otherwise prevail will lead companies to expand thus leading to lower unemloyment. However this is short term because money supply booms always lead to money supply slumps which lead to more unemployment than would have occurred if the process had never been tampered with in the first place. So no point in allowing a little inflation just to keep unemployment down for a little while. 10% rise in minimum wage cuts employement by 1-2% (US) Ec Ap27,96

Unemployed people cost Ł8000 pa in benefits and lost tax revenues

(% GDP spent on Unempl: .8% us , 1.8 uk, 2.6 Ger, 3.6 Swed)

The % of people working has risen in US from 62% of those of working age to 71% in 1992, in the UK its about the same at 68%, in France dropped 62-58%

Only one job in three is of the typical 9-5 type

Crime causes unemployment in certain areas as companies are driven out by the higher costs of theft and security.

C16 England: JPs set minimum wages in the cloth industy which made it harder for it to adjust to the decline in 1550s, also maximum wages in agriculture to "protect" small employers. It is clear from the latter that there was little unemployment as labour was obviously short in these areas. So no need for Elizabethan poor laws and clear evidence of market clearing.

Since 1974 there have been 23 million new jobs in the US and none in the EC. The main difference is the inflexible labour markets and benefits in the EU. SOE Unemployment rate in America had been double Europe. Countries with high bankruptcy rates also have high rates of growth eg Texas, early Japan. % unempl which are unemployed for over a year France 38, ger 46, Irel 60 Americans11% America loosing 2% of its jobs per month versus only 0.4% in Eur but Eur not replacing In Denmark , unemployed youths who don't join vocational training see their dole halved after 6 months. Rate of youth unemployment fallen to 4.8% ( 16-25 yrs) among lowest in Europe. House ownership and unemployment are inversely related , people renting can move to find jobs easier (Uni of Warwick study) Anec : Wages in London are far higher than in the rest of the country indicating people don't move to find work ( because of welfare) FOFC : Downsizing in US : 12% exited labour force (retired), 17% unem 2 yrs later,31% reemployed for 25%+ less wages, 32% employed on 0-25% less wages, 32% remployed on equal or higher wages Minimum wage in France $1215 per month = Ł20 per hour ! Its lowest decile earns 80% more than the lowest decile in the States A whole set of low wage industries simply can't exist in Europe ! WTF : most of the unemployed are working in the underground economy