General causes of unemployment

The causes of unemployment can be described under four main

categories: - Seasonal unemployment - Frictional
unemployment - Structural unemployment - Cyclical
unemployment
Seasonal unemployment
Seasonal unemployment happens due to regular and predictable
seasonal changes in employment / labour demand. Seasonal
unemployment affects certain industries more than others. For
example it is a common feature of employment in these industries:
Catering and leisure Construction Retailing Tourism
Agriculture
Frictional unemployment
Frictional unemployment is transitional unemployment due to
people moving between jobs: For example, redundant workers or
people joining the labour market for the first time such as university
graduates may take time searching to find the work they want at
an acceptable wage or salary.
Imperfect information in the labour market may make frictional
unemployment worse if the jobless are unaware of the available
jobs. Incentives problems can also cause some frictional
unemployment as some people looking for a new job may stay out
of work if they believe the tax and benefit system will reduce the
net increase in income from taking work. When this happens there
are disincentives for the unemployed to accept work this is
known as the unemployment trap.
Structural unemployment
Structural unemployment occurs when there is a long run decline
in demand in an industry leading to a reduction in employment
because of international competition. Globalisation is a fact of life
and inevitably it leads to changes in the patterns of trade between
countries from year to year.
For example, the UK has probably now lost forever, its cost
advantage in manufacturing goods such as motor cars, household
goods and audio-visual equipment, indeed our manufacturing
industry has lost over 500,000 jobs in the last five years alone as
production has shifted to lower-cost centres in Eastern Europe and
emerging markets in Far East Asia. Many of these workers may
suffer from a period of structural unemployment, particularly if they
are in regions of above-average unemployment where job
opportunities are scarce.
You can see the effect of structural unemployment on the UKs
manufacturing sector in the chart further below.

Structural unemployment exists where there is a mismatch
between the skills of the workforce and the requirements of the
new job opportunities. Many of the unemployed from
manufacturing industry (e.g. in coal, steel and engineering) have
found it difficult to find new work without an investment in re-
training.
Cyclical unemployment
Cyclical unemployment is due to a lack of demand for goods and
services. When there is a recession or a slowdown in economic
growth, we see a rising unemployment because of factors such as:
Plant closures and other actions to reduce production capacity
Business failures Redundancies Outsourcing to reduce costs
This is due to a fall in demand leading to a contraction in output
across many industries.
An important evaluation point to note is that the economy does not
have to go into recession for cyclical unemployment to start rising.
Many jobs can be lost even in a mild slowdown phase and one
reason for this is because of rising productivity.

Unemployment in Nepal


The people who are temporarily without job are called unemployed. The
state of being unemployed is unemployment. If people do not get apt
job to be employed, it is called the problem of unemployment.
Nowadays, this problem is a burning challenge in Nepal. Many people
are unemployed in Nepal. The number of them is rapidly increasing.
Therefore, it is a serious problem in Nepal. There are many causes of
unemployment in Nepal. Nepal is an agro-based country.
Firstly many people are employed in agriculture, but now days it is a
trend of leaving agriculture is increasing. People feel that agriculture is
not economically beneficial. They go to towns to look for good job but
they cant get any job easily and become unemployed.( Frictional)
Secondly, some educated people are extremely traditional. They think
that educated people should not start simple job they stay at home
being jobless. (Structural)
Thirdly,Loss of businesses and less employment due to maoist
insurgency.( cyclical unemployment).
Forthly,(example in case of Nepal)Seasonal unemployment
happens due to regular and predictable seasonal changes in
employment / labour demand.


Other reasons of unemployment
Most of the students in Nepal are getting general education. They do
not have apt knowledge and skill of technical and practical education.
Also, the job opportunity in Nepal is very limited. So the problems of
unemployment produced criminal activities in Nepal.