UNEMPLOYMENT

Economists are unable to agree on the causes of or cures for unemployment (or anything else, it seems). The essence of the Keynesian explanation is that firms demand too little labour because individuals demand too few goods. The classical view was that unemployment was voluntary and could be cleared by natural market forces. The neo-classical theory is that there is a natural rate of unemployment, which reflects a given rate of technology, individual preferences and endowments. With flexible wages in a competitive labour market, wages adjust to clear the market and any unemployment that remains is voluntary. The latter view was that held by Milton Friedman and strongly influenced government policy in the early 1980s, but without success. There is, of course, no simple explanation of unemployment and no simple solution.

                                                ATTITUDES TO WORK

The IPD research into employee motivation and the psychological contract (Guest et al, 1996; Guest and Conway, 1997) obtained the following responses from the people they surveyed:

● Work remains a central interest in the lives of most people. 

● If they won the lottery, 39 per cent would quit work, but most of the others would continue working. 

● Asked to cite the three most important things they look for in a job, 70 per cent of respondents cited pay, 62 per cent wanted interesting and varied work and only 22 per cent were looking for job security. 

● 35 per cent claimed that they were putting in so much effort that they could not work any harder and a further 34 per cent claimed they were working very hard.