Long-term Unemployment Rate Research Articles

Phillips Curve: The Greek Case

One of the most important problems facing Greece is the long-term and high-level unemployment rate. The Economic Adjustment Programmes (EAPs) focused on the supply side of the economy, aiming at the adjustment of prices and wages, draw on the classical economic model, as it is widely accepted that internal devaluation policies keep inflation low. This article attempts to examine whether the Keynesian theory and the Phillips Curve, which shows the relationship between unemployment and inflation, apply in the case of the Greek economy. We use descriptive statistics, ordinary least squares (OLS) and VAR Analysis to examine the relationship between the variables. According to the results, there is a negative correlation between unemployment and inflation in Greece, thus confirming the Phillips Curve hypothesis. Finally, results show that unemployment is less dependent on inflation compared with the past, and there are numerous other decisive factors affecting unemployment.

Social Assistance for Poverty Reduction in the EU Countries: An Aspect of Socio-Economic Sustainability

Abstract
 Research on the impact of social assistance benefits and other socio-economic indicators on poverty reduction during 2000 – 2017 in 24 EU countries is presented in the paper. In order to assess the impact a regression analysis model of the panel data was composed by including such indicators as changes in gross total expenditure per capita, the GDP growth rate, the share of the retirement-age population, the unemployment rate of the working-age population, the long-term unemployment rate. Research findings revealed the main socio-economic indicators that have the greatest impact on changes in poverty. The economic slowdown reduced the at-risk-of poverty gap of people with the lowest income and the economic growth reduced the poverty gap with a lag of two periods (years). The overall impact of all social transfers under analysis on the at-risk-of poverty gap was insignificant. The at-risk-of poverty rate, which shows changes in the share of the most deprived population under analysis, increased when non-targeted and means-tested benefits gal geriau social transfers increased. On the basis of these findings it can be stated that, during the period under analysis, social assistance was not well-directed, i.e. did not focus on the most deprived part of the population. 
 Keywords: sustainable development, social assistance benefits, means-tested benefits, the at-risk-of-poverty rate, the relative poverty gap, panel data.

How does the digital economy and society index (DESI) affect labor market indicators in EU countries?

OBJECTIVE: This study aims to determine the effects of the DESI (connectivity, human capital/digital skills, use of internet service by citizens, integration of digital technology and digital public services) on labor market indicators (labor market insecurity, long-term unemployment rate, employment rate, and personal earnings). METHODS: In the study, the 2018 DESI data, the 2018 Better Life Index (job) data and 23 EU countries were analyzed. In the analysis, the SmartPLS 3.0 program was executed with 23 cases and 5000 bootstraps. RESULTS: It was concluded that an increase in the DESI has increased employment rate and personal earnings, which are positive labor market indicators (t: 15,929; 0,849) and has decreased long-term unemployment rate and labor market insecurity, which are negative labor market indicators (t: 3,685; –0,535). CONCLUSIONS: As a result, digitalization in EU countries for the year 2018 has proved that the labor market indicators were improving.

The impact of the output gap on the unemployment rate: evidence from Mexico, 1987q1-2018q4

Using quarterly data for Mexico from 1987Q1 to 2018Q4, we measure the impact of output gap on the unemployment rate based on a State-Space model with time-varying coefficients. From an econometric modeling point of view, this model allows asymmetrical interactions between the output gap and unemployment rate. Our principal conclusions are: 1) The long-term equilibrium unemployment rate is equal to 3.06; 2) the unemployment rate does not exhibit hysteresis; 3) when GDP is lower than potential output, the impact of its growth on the unemployment rate is -0.43 percent points; and 4) when GDP is higher than potential output, the impact of its growth on the unemployment rate is close to zero. It implies that the reaction of the unemployment rate to output gap is different when the output gap is increasing from that when the output gap is decreasing; i.e., the output gap does not have the same effect on the unemployment rate over time.

Activation is not a panacea: active labour market policy, long-term unemployment and institutional complementarity

AbstractEvaluation studies of active labour market policy show different activation measures generate contradictory results. In the present study, we argue that these contradictory results are due to the fact that the outcomes of activation measures depend on other institutions. The outcome measure in this study is the long-term unemployment rate. Two labour market institutions are of special interest in this context: namely, employment protection and unemployment benefits. Both institutions, depending on their design, may either increase or decrease the effectiveness of active labour market policies in lowering long-term unemployment. Based on an analysis of macro-level data on 20 countries over a period of 16 years, our results show that employment protection strictness and unemployment benefit generosity interact with the way in which active labour market policies relate to long-term unemployment. Our results also indicate that, depending on the measure used, active labour market policies fit either in a flexible or in a coordinated labour market. This suggests that active labour market policies can adhere to both institutional logics, which are encapsulated in different types of measures.

Labour Inequalities in Europe: The Case of Serbia

Gender differences present a topic of great interest in contemporary societies. Aim of this paper is to make a comparison between the unemployment in Serbia and the European countries, and to identify those countries which record the most similar performances considering gender and age. The research is conducted through analysis of activity rates, employment rates, unemployment rates, inactivity rates and long-term unemployment rates. The factor analysis enabled us to identify main factors that influence structures of the labour markets in Europe. Final result of this research is the recommendation of policy measures, including the promotion of women entrepreneurship, in order to reduce gender inequalities in contemporary society's economic activity.

Labor Market Dynamics in Urban China and the Role of the State Sector

This paper studies the effect of state-owned enterprises on the dynamics of the Chinese urban labor market. Using longitudinal monthly panel data, we document very low dynamics in the labor market, especially in the state sector. We develop and calibrate an equilibrium search and matching model with three differences between the state and the non-state sector: labor productivity, labor adjustment cost, and workers' bargaining power. Counterfactual analysis shows that the lack of dynamics is mainly driven by the strong bargaining power of state-sector workers. Eliminating the differences between the two sectors substantially reduces the unemployment rate and long-term unemployment rate.

Unemployment and suicide in Italy: evidence of a long-run association mitigated by public unemployment spending.

From the mid-1990s on, the suicide rate in Italy declined steadily, then apparently rose again after the onset of the Great Recession, along with a sharp increase in unemployment. The aim of this study is to test the association between the suicide rate and unemployment (i.e., the unemployment rate for males and females in the period 1977-2015, and the long-term unemployment rate in the period 1983-2012) in Italy, by means of cointegration techniques. The analysis was adjusted for public unemployment spending (referring to the period 1980-2012). The study identified a long-run relationship between the suicide rate and long-term unemployment. On the other hand, an association between suicide and unemployment rate emerged, though statistically weaker. A 1% increase in long-term unemployment increases the suicide rate by 0.83%, with a long-term effect lasting up to 18 years. Public unemployment spending (as percentage of the Italian gross domestic product) may mitigate this association: when its annual growth rate is higher than 0.18%, no impact of unemployment on suicide in detectable. A decrease in the suicide rate is expected for higher amounts of social spending, which may be able to compensate for the reduced level of social integration resulting from unemployment, helping the individual to continue to integrate into society. A corollary of this is that austerity in times of economic recession may exacerbate the impact of the economic downturn on mental health. However, a specific "flexicurity" system (intended as a combination of high employment protection, job satisfaction and labour-market policies) may have a positive impact on health.

Comparing Negative Attitudes Toward the Unemployed Across European Countries in 2008 and 2016: The Role of the Unemployment Rate and Job Insecurity

AbstractWe explore how negative attitudes toward the unemployed are related to countries’ overall and long-term (LT) unemployment rate. Insights from the risk attribution and position theory are combined with the in-group–out-group conflict model, derived from migration literature. Multilevel analyses are performed on two waves (2008 and 2016) of the European Social Survey. Negative attitudes toward the unemployed are measured via the item “most unemployed people do not really try to find a job.” Results show that in countries with a high LT unemployment rate and/or an increase in this rate, people are more likely to hold negative attitudes toward the unemployed. Moreover, this is more pronounced among people in secure job conditions (those with a permanent contract and/or perceiving job security).

الأثر الديناميكي للنمو الاقتصادي على البطالة-دراسة حالة الجزائر-

This study aimed to analyze and measure the dynamic impact of economic growth on unemployment rates in the Algerian economy for the period (1985-2015) using the time series methods of the study variables. To achieve this goal, the dynamic relationship between unemployment rates and macroeconomic variables was estimated by using ARDL Bounds Testing Approach to Co-integration to estimate short- and long-term elasticities. The main findings of this study are: The components of the economic activity represented by both economic growth rates and capital accumulation rates have a slight impact on long-term unemployment rates. In the long term, unemployment rates don’t respond to both the volume of government expenditure and exports and imports, in addition, Phelps's relationship was not achieved. The study recommended that the structure of the Algerian economy should be reformed in such a way as to accommodate a larger number of workers and increase growth rates, while encouraging labor-intensive investments, thereby increasing real growth domestic product(GDP) and reducing unemployment

The use of beta regression in the modelling of severe material deprivation indicator in the European Union countries

The severe material deprivation rate indicates the proportion of the population that cannot fulfil at least four of the nine needs identified as basic ones in the European conditions. The study attempts to identify factors differentiating this indicator in the European Union countries. The parameters for regression beta models were estimated on the basis of data from the European Survey of Income and Living Conditions (EU-SILC) for 2014. Such models are useful when the value of the dependent variable interval is included between 0 and 1. It was found that severe material deprivation rate is affected by such factors as: type of household, median equalized disposable income, at-risk-of-poverty rate, relative median at-risk-of-poverty gap, inequality of income distribution, long-term unemployment rate, GDP per capita, and share of social protection expenditure in GDP.

Feminisation of Poverty - Social Assistance Female Clients in Poland = Feminización de la pobreza - clientes femeninas de asistencia social en Polonia

Abstract. Feminization of poverty is referred to as the most characteristic feature of contemporary poverty. This term applies to a greater share of women in the population at risk of poverty and the consequences of poverty for women, the difference between the poverty of women and men as well as a deeper poverty of households where a woman is the main breadwinner. Feminization of poverty in Poland can be seen in various areas of social life. On the macro scale, it is related to the situation of women in the labour market (lower employment rate, higher long-term unemployment rate, difficulties in finding employment and reintegration into the labour market) and to the area of income (lower wages and retirement benefits). On the other hand, the feminisation of poverty and social exclusion in the microscale of the family and household is related to the unequal distribution of household chores and duties on the basis of gender. Additionally, what seems to be important here is the question of money management and controlling household expenses. Women are more likely than men to be at risk of poverty because they are more frequently faced with social problems such as domestic violence, partner alcoholism, loneliness and due to their disproportionately low participation in public and political life. The paper was based on empirical research which had a qualitative (90 individual in-depth interviews with social workers) and quantitative nature (500 Computer Assisted Telephone Interviews with social workers from all of Poland).Keywords: poverty, feminization of poverty, social assistance, social workers, gender.Resumen. La feminización de la pobreza se conoce como el rasgo más característico de la pobreza contemporánea. Este término se aplica a una mayor proporción de mujeres en la población en riesgo de pobreza y las consecuencias de la pobreza para las mujeres, la diferencia entre la pobreza de mujeres y hombres, así como una pobreza más profunda en los hogares donde la mujer es el sustento de la familia. La feminización de la pobreza en Polonia se puede apreciar en varias áreas de la vida social. En la escala macro, se relaciona con la situación de las mujeres en el mercado laboral (menor tasa de empleo, mayor desempleo de larga duración, dificultades para encontrar empleo y reintegración en el mercado laboral) y en el área de ingresos (los salarios y pensiones más bajos). Por otro lado, la feminización de la pobreza y la exclusión social en la microescala de la familia y el hogar se relaciona con la distribución desigual de los deberes y las tareas domésticas en función del género. Además, lo que parece ser importante aquí es la cuestión de la gestión del dinero y el control de los gastos del hogar. Las mujeres tienen más probabilidades que los hombres, de estar en riesgo de pobreza, porque se enfrentan con mayor frecuencia a los problemas sociales como la violencia doméstica, el alcoholismo asociado, la soledad y la participación desproporcionada en la vida pública y política. El artículo se basó en una investigación empírica que tuvo una naturaleza cualitativa (90 entrevistas individuales en profundidad con trabajadores sociales) y cuantitativa (500 entrevistas telefónicas asistidas por ordenador con trabajadores sociales de toda Polonia).Palabras clave: pobreza, feminización de la pobreza, asistencia social, trabajadores sociales, género.

An Evaluation of the Scale of Undeclared Work in the European Union and Its Structural Determinants: Estimates Using the Labour Input Method

An Evaluation of the Scale of Undeclared Work in the European Union and Its Structural Determinants: Estimates Using the Labour Input Method

Hysteresis and labour market institutions. Evidence from the UK and the Netherlands

This paper uses data for the UK and the Netherlands (1983q4–2011q4) to test if hysteresis occurs in these economies, and through what mechanisms. The novelty of the paper resides in the use of a VAR-IRF that encompasses previous hysteresis studies, using long-term unemployment, productivity, capital stock and real long-term interest rates, and in the use of specific Labour Market Institutions shocks, such as benefits, taxation or unions’ power. This allows us to disentangle what specific demand and supply-variables affect unemployment in the long-run, i.e. the NAIRU. Our findings suggest that there is hysteresis in both countries, and that it happens through several channels. Further, we find that the influence of Labour Market Institutions on unemployment depend on their impact on the real wages-productivity gap. These results have implications for structural and macroeconomic policies that we also discuss. Finally, we investigate the impact of different supply and demand-shock on long-term unemployment and discuss the relevant policy implications.

Labor Market Trends in Greece over the Crisis Period, 2009-2014

In this paper we present key statistics on the labor market of Greece and the Eurozone over the crisis period 2009-2014, with particular emphasis given to youth and longterm unemployment and its consequences. Statistics on the previous occupations of the unemployed, methods used for seeking work and type of employment sought are also presented. Used data reveal that the change of the working-age population in Greece during the crisis follows a U-shape over age with a greater decline occurring in the 25 to 29 years age group as a result of high emigration of the young age group attributable to the decline in economic activity. Greece suffers from unprecedented and socially unacceptable rates of unemployment with the youth and long-term unemployment rates being even more alarming and worrying as they may have such devastating and long-term debilitating effects on young people that have been called ‘scarring effects’. Those scarring effects on young people are interpreted in the literature’ in terms of two factors, the first factor relating to the depreciation of their human capital and readiness to work and the second relating to the so-called ‘unemployment stigma’.

Long-term employment among people at ultra-high risk for psychosis

BackgroundPsychotic disorders are associated with high rates of sustained unemployment, however, little is known about the long-term employment outcome of people at ultra-high risk (UHR) of developing psychosis. We sought to investigate the long-term unemployment rate and baseline predictors of employment status at follow-up in a large UHR cohort. Method268 UHR patients recruited from the Personal Assessment and Crisis Evaluation clinic in Melbourne, Australia were followed-up over 2–14years after initial presentation to the service. Individuals in no form of employment or education were classed as unemployed. Logistic regression analyses were used to examine predictors of employment outcome. ResultsA high rate of unemployment was present at follow-up in this UHR sample (23%). At baseline, those who were unemployed at follow-up had a longer duration of untreated illness, more severe negative symptoms, lower IQ, poorer social and occupational functioning and reported more childhood trauma than the employed group. At follow-up, unemployed individuals exhibited significantly more severe symptoms on all measures and were more likely to have been diagnosed with a mood, anxiety, psychotic or substance use disorder. Childhood trauma and the duration of untreated illness at baseline were significant independent predictors of employment status at follow-up in the multivariate analyses. ConclusionsNearly a quarter of this UHR sample was unemployed at long-term follow-up. The duration of untreated illness and the effects of childhood trauma are potentially modifiable risk factors for long-term employment outcome in this group. Vocational support may be beneficial for many UHR patients presenting to services.

Társadalmi és gazdasági tényezők hatása a Kassai kerület munkanélküliségének alakulására 1993-tól napjainkig

Szlovákia különböző térségei más-más helyzetből indulva eltérően reagáltak a piacgazdasági átmenet kihívásaira. Társadalmi-gazdasági egyenlőtlenségek alakultak ki, éles határ húzódik a keleti és a nyugati országrész között. A kilencvenes évek társadalmi-gazdasági folyamatainak egyik meghatározó eleme volt a tömeges és tartós munkanélküliség.A tanulmány célja, hogy bemutassuk a munkanélküliség alakulását a Kassai kerületben a szlovák államalapítástól napjainkig. Tanulmányunk kiemelten foglalkozik azokkal a kormányzati intézkedésekkel, amelyeket a munkaerő-piaci körülmények változtatásának érdekében tettek.A következő megállapítások vonhatók le röviden: a Kassai kerületben kialakult előnytelen munkaerő-piaci helyzet az átgondolatlan rendszerváltás és az egyes szlovákiai kormányok intézkedéseinek negatív „mellékterméke”. Napjainkban a munkanélküliség súlyos problémának számít, elengedhetetlen a különböző gazdasági és társadalmi eszközökkel, aktív munkaerő-piaci politikával történő beavatkozás.

Nezaposlenost i dugotrajna nezaposlenost doseljenih u Hrvatsku

U Hrvatskoj u okviru migracijskih tema dominira pitanje emigracije, posebno mladih i obrazovanih, podjednako u literaturi i raspravama u siroj javnos

Lost between Sustainability and Adequacy: Critical Analysis of the Croatian Pension System’s Parametric Reform

Nowadays, when faced with aging societies, family structure changes, labour market transformations, non-standard employment arrangements, shadow economy, financial and economic crisis, many are worried about the two basic issues: pension systems’ financial sustainability and benefit adequacy (both short-term and long-term). Therefore, almost all countries in the world made some changes to their pension systems. The situation is even more aggravated in countries with high budget and pension system’s deficits, unfavourable dependency ratios, long-term negative natural increase rates, low employment and high unemployment rates. Unfortunately, Croatia suffers from all these problems. Therefore Croatian pension system has undergone many reforms: one systemic reform (from 1998 to 2002 which resulted in the establishment of the three-pillar pension system), and several parametric reforms, the last one encompassing all three parts of the pension system (2013-2015). The purpose of the paper is to provide legal analyses of this last parametric reform in the light of sustainability and adequacy concerns with some inevitable reminders of the previous reform solutions. The author reveals many inconsistencies and lack of prudence in legislator’s approach, which in the long-term potentially endangers both the financial sustainability and benefit adequacy. Moreover, numerous and frequent legislative changes coupled with the existence of many groups of privileged pensioners raise further concerns regarding predictability, stability, efficiency and fairness of the pension system as well as trust in the national government. Furthermore, the author warns that only part of the solutions lies within the pension system itself (through more thoughtful adjustments). Those changes should be complemented by other strategies outside the pension policy (e.g. within the health care system, tax system and labour market regulations).

Hysteresis and Labour Market Institutions: Evidence from the UK and the Netherlands

This paper uses data for the UK and the Netherlands (1983q4-2011q4) to test if hysteresis occurs in these economics, and through what mechanisms. The novelty of the paper resides in the use of a VAR-IRF that encompasses previous hysteresis studies and the use of specific Labour Market Institutions shocks. This allows us to disentangle what specific demand and supply-variables affect unemployment in the long-run. Further we also investigate the impact of different supply and demand-shock on long-term unemployment. Our findings suggest that there is hysteresis in both countries, and that it happens through different channels, namely, long-term unemployment, productivity, capital stock and real long-term interest rates. These results have implications for structural and macroeconomic policies that we also discuss.