QUESTION 46 (4 marks)
After repeated unsuccessful applications, some willing workers stop actively searching. Explain how the measured unemployment rate could fall even though labour-market conditions have not improved. Name the relevant unemployment concept.
Practice marking scheme
Answer
Hidden unemployment can rise as discouraged workers leave the measured labour force.
Working
Official unemployment counts people without work who are actively seeking and available for it. Discouraged workers who stop searching generally leave both the unemployed count and the labour-force denominator. The recorded rate can fall without new jobs. Assessing full employment therefore requires more than the headline unemployment rate.
Marking criteria
- Identifies hidden unemployment/discouraged workers. [1 mark]
- Explains exclusion from unemployment and the labour force. [2 marks]
- Explains why a lower recorded rate need not mean improvement. [1 mark]
Practice question aligned to the current QCAA syllabus; review the worked solution and marking criteria.
View the QCAA syllabusCompare your working with the guide above.