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Article Review: Unemployment In Arkansas

850 words - 3 pages

The article discusses the recent drop in the unemployment rate in Arkansas. Analysts expect the economy to improve due to government imposing service related jobs to replace the manufacturing jobs that were lost. The economy and unemployment rate will increase over the next year, though the government implemented job seem to take a long time for those directly affected by the initial loss of jobs.The article also touches upon the housing boom which was occurring, it has slowed but is still continuing at a healthy level of activity. The slow gains of the economic recovery are modest yet over the long run they will show the positive effects of government sanctions. The economy is constantly going through cycles of business which consist of ups and downs, periods of recession and expansion. Recessions are caused by a decrease in consumer expenditures, which can come from loss of income and high interest rates. We live in a mixed economy which means that the government steps in to assist the economy in times of need when possible.Unemployment is one issue which the government attempts to help alleviate. There are four types of unemployment, frictional which is workers in transition, structural, which is when workers lose their jobs due to changes in technology, seasonal which is a result of the changing seasons, and cyclical which is because of a recession. The type of unemployment caused in Arkansas is a mix of structural and cyclical.The government will attempt to help by implementing job search programs to help workers find jobs, job training programs to help workers compete with advancements in technology, and they also can implement tax cuts, lower interest rates, and more government spending. There last tools that the government can use, take much longer to work, and are often too late because a recession is not officially declared a recession until after six consecutive months of decreasing GDP. The benefits given by the government apply only to those who are fired, not those who quit, the minimum time of employment or minimum income. The benefits themselves are a percentage of the workers previous pay or a preset minimum. The unemployed are also only allowed to collect their benefits for a maximum of 26 weeks or six months during which time they have to be searching for a job.The government is interested in decreasing unemployment using it's service related jobs because unemployment leads to a loss of output, and an increase in government expenditures, deficit, debt and interest payments. The FED also deals with unemployment by cutting the reserve ratio, cutting the...

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