The impact of the financial crisis on the UK job market and employment (2007-2009)
Module: PM021-Aspects of British Culture and Society
Name: JUN YU WU
Student Number: 0908108
Tutor: Jeff Meadowcroft
Word Count: 1,970
Contents
1. Introduction……………………………………………………………………...Page 3
2. Global financial crisis (2007-2009)………………………………………Page 3
3. Influence on world job market……………………………………………Page 3-4
4. Influence on the UK job market………………………………………….Page 4-5 4.1 Short-term changes……………………………………………………..Page4-5 4.2 Long-term changes……………………………………………………….Page 5
5. Analysis of current situation in the UK………………………………Page 5 5.1 “British jobs for British workers”………………………………….Page 6 5.2 Job
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Taking into account those employed part time for economic reasons and discouraged workers was 16.3%. (Bureau of Labor Statistics, US Government, 2009) In Spain, the unemployment rate stood at 18.7% (37% for youths) in May 2009 — the highest in the eurozone. (CBCNews.ca, 2009) In July 2009, the unemployment rate was reduced from 9.5% to 9.4%. Even fewer jobs were lost in August, 216,000, recorded as the lowest number of jobless since September 2008, but the unemployment rate rose to 9.7% in October 2009, it is said that some employers who cut jobs due to the recession are beginning to hire them back. The rise of advanced economies in China, India, and Brazil increased the total amount of word job market significantly. With the rapid development of communication and education in these countries, there are more workers allowed to compete with workers in traditionally strong countries, such as the United States. This has a negative effect on wages and contributed to unemployment. (Telegraph, 2009) In addition, Britain has equal situation in terms of job market.
4. Influence on the UK job market 1. Short-term changes
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The left graph shows that the employment rate for July to September 2007 in the UK was 74.5 percent, peaking at 75 percent in the year-end and dropped to around 72.5 per cent for
Unemployment rate also had bad effect in America due to 9/11. The unemployment rate was just 4.9% in 2001 before the 9/11 attacks. But after the attacks, approximately 600,000 jobs were lost. Of those, 226,000 jobs were in travel and tourism. Not only that but also 1,100 businesses were disturbed at the World Trade Center. The unemployment rate was 5.7% in the end of the year (Miley). In 2011, the unemployment rate was 9.1% and as of October 2013,
The largest cause of unemployment can be attributed to recession. The term recession refers to the backward movement of the economy for a long period. People spend only when they have to. (Nagle 2009). With people spending less there would be less money in circulation therefore, enterprises would suffer financially and people would suffer too. This is so because recession reduces the fiscal bases of enterprises, forcing these enterprises to reduce their workforce through layoffs. These enterprises lay off their workers in order to cut the costs they incur in terms of wage and salary payments.
As of March, 2013 the U.S. National Unemployment rate was 7.6%. A total of 11.7 million people were reported as unemployed by the Bureau of Labor Statistics. This rate is improved from the height of the recent recession, where the statistic floated around 9%, but it is still not the usual 3-4% figure we are used to seeing in regular market conditions. (bls.gov, US, 2013)
as the unemployment rate for all persons rose from 4.6% to 6.6%. The unemployment rate for
The financial crisis of 2008-2009 uncovered an unstable and unbalanced model of economic growth in the UK, which was based on growing levels of public and private sector
The recent job growth is impressive with an increase in 3.4% though the unemployment rate is still at 10% (U.S. average is 5.2%). With this recent increase, there is
While there are expectations of a yearly gain of nearly 2.3 million net new jobs, the unemployment rate is still very high i.e. around 6.5 percent. The lower-than-expected job growth is fueled by various factors including government hiring, weather, and Obamacare. Actually, similar to December, January had a lower-than expected increase in job opportunities since only 113,000 jobs were created. However, the rate of unemployment still reduced to 6.6 percent in this month despite of the growth in labor force. The current rate of unemployment is the lowest in U.S. since the 2008 recession because more people are leaving the labor force instead of finding jobs.
Unemployment during the Great Depression was severe. In as early as 1933, the fourth year of the Great Depression, the unemployment rate was almost 25 percent, which means more than eleven million people were out of work. The unemployment rate was lower in states like Michigan and Ohio, which had plenty of jobs dependant on massive industries. However, Washington was hit hard, where one third of Washington was unemployed in early 1933. Some factors that also caused unemployment were the collapse of the stock market, drought conditions which destroyed agriculture, and deflation in prices. Businesses shut down and Government guarantees did nothing, and unemployment increased since alternative job sources were not available.
Those struggling because of their country’s economy can only do so much to help their situation, it is important to aid those people and help bring them back to their feet because without helping the poverty stricken, jobless, and homeless, we are also doing nothing to save our country from disaster.
In the past few months, the Brexit referendum attracted the attention from the whole world. The globalisation has made the world today far more connected than ever so that every country could be affected by this big event. The globalisation has had profound and lasting influences to UK economy. This essay will firstly focus on the pros and cons of globalisation, then discuss the UK sectors which benefited and suffered from globalisation respectively, finally analysis the overall effect of globalisation on the UK economy.
The “Great Recession” is commonly used to explain the massive economic contraction that occurred in the United States during the fourth quarter of 2007. However, the actions of the United States spanned to other nations, leaving massive effect on the global economy. One nation that took on serious financial burden during this recession was the United Kingdom. This nation first faced the effects of the Great Recession beginning in the first quarter of 2008. Overall, the initial mass effects on the nation can be attributed to the nation’s reliance on the financial sector. In fact, after partially stabilizing in 2009, the country struggled with a double-dip recession between 2010-12, and continues to struggle with some of these effects.
The 2008 financial crisis can be traced back to two factor, sub-prime mortgages and debt. Traditionally, it was considered difficult to get a mortgage if you had bad credit or did not have a steady form of income. Lenders did not want to take the risk that you might default on the loan. In the 2000s, investors in the U.S. and abroad looking for a low risk, high return investment started putting their money at the U.S. housing market. The thinking behind this was they could get a better return from the interest rates home owners paid on mortgages, than they could by investing in things like treasury bonds, which were paying extremely low interest. The global investors did not want to buy just individual mortgages. Instead, they bought
Just after ten years of Asian financial crisis, another major financial crisis now concern for all developed and some developing countries is “Global Financial Crisis 2008.” It is beginning with the bankruptcy of Lehman Brothers on Sunday, September 14, 2008 and spread like a flood. At first U.S banking sector fall in a great liquidity crisis and simultaneously around the world stock markets have fallen, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems. (Global issue)
Financial Crisis between 2007 and 2009 was the worst economic crisis after the Great Depression in 1930s. This crisis was a worldwide crisis as it affected the financial system globally and led to collapse in economy. Financial intermediation is a process of banks that take funds from the depositor and lend them out to the borrower. In the financial transaction, financial intermediary acts as the middleman between two parties. Commercial bank, investment banks, pension funds are the example for financial intermediation. This kind of financial intermediary usually provide mortgage to the lender.
As non-European companies raised the standard of competition, the prices likewise fell and the market for many European products collapsed. This directly affected the employment rate throughout Europe in many of the industries, as many jobs were no longer needed. As this need declined, labor began to demand the retention of jobs, wages, and benefits, making labor more costly (Drouin,12). The unemployment rate in Europe went from 4-5% in the 1950-60s to 10-12% during the 1970-80s (Dr. Shearer - lecture). For example, after World War II the mining workforce in the UK fell from 718,000 to 43,000, with the majority of the jobs lost during 1975-85 (Judt, 459). The steel industry also suffered. As non-European countries entered the market, the European steel industry collapsed. For example, British steelworkers lost 166,000 jobs between 1974-1986 (Judt, 459). As unemployment increased throughout Western Europe, there was a movement towards the service sector.