Asked by Shubhansh Singh on Jul 15, 2024
Verified
Unemployment generated by the existence of labor unions is structural unemployment and so contributes to the natural rate of unemployment.
Structural Unemployment
A situation where there is a mismatch between the skills workers have and the skills needed by employers due to technological changes or other factors.
Labor Unions
Organizations formed by workers from related fields that work for the common interest of its members in terms of wages, working hours, working conditions, and other employment matters.
Natural Rate
The unemployment rate at which the economy operates at full capacity, with only frictional and structural unemployment.
- Analyze the relationship between union activities, right-to-work laws, and structural unemployment.
Verified Answer
AA
Austin AdamsJul 16, 2024
Final Answer :
True
Explanation :
Labor unions can lead to structural unemployment by negotiating wages that are above the market equilibrium, which can result in employers hiring fewer workers. This type of unemployment is considered structural because it is related to the structure of the labor markets and contributes to the natural rate of unemployment, which includes frictional and structural unemployment.
Learning Objectives
- Analyze the relationship between union activities, right-to-work laws, and structural unemployment.