A Simple Case of Supply and Demand - The Primary Cause of Unemployment
You may be aware that unemployment figures have skyrocketed over a very short period of time and there is evidence to support the view that this boom is likely to continue.
Today I want to tell you why this is the case and why experts predict that it could continue for some time.
The leading factors contributing to unemployment can be put into two classifications: They are 'supply-side' factors and 'demand-side' factors.
Supply-side factors are relevant when a business is not able to fulfill product demand for the same cost as their competitors.
There is still a demand for the company's service or product, but it is available cheaper elsewhere.
Minimum wage restrictions stop the company from lowering employee wages and so the business can be forced to downsize.
Demand-side factors relate to drops in demand for a service or product provided by a business.
This affects the company's turnover and hence, they must reduce outgoings.
This is often achieved by cutting jobs.
An example of 'supply-side' is the outsourcing of call centres.
Many companies now opt for outsourcing call centre operations to countries like India, due to the vast difference in cost for the same service.
Some people are disgusted by this, but if you owned a call centre and could reduce overheads by as much as 50% would you not be tempted? Advancements in technology and telecommunications have made this possible, but it does have a detrimental impact on our own economy.
An example of 'demand-side' is the car manufacturing market.
Because of the perception that our economy is in crisis, some people are now reluctant to buy expensive new cars, opting for less expensive used cars, or putting off upgrading their automobile altogether.
If you have researched purchasing a brand new car recently you will have seen that there are exceptional offers available, as the manufacturers and dealerships are struggling to generate sales.
Although this is the situation there is little or nothing we can do about the situation.
However, by being conscious of it, we can explore alternative ways of generating additional income, taking advantage of industry trends.
If you have ever considered building your own business then you would benefit greatly from identifying the impact that technology and the Internet is having on industry and business.
What you may notice is that most successful businesses today rely on the Internet to market and promote products.
This enables them access to a world market and with the advancing information age it is necessary to harness the Internet as often as possible! I am confident that this article provides you valuable insight, if you consider starting a part-time business at a later date.
Today I want to tell you why this is the case and why experts predict that it could continue for some time.
The leading factors contributing to unemployment can be put into two classifications: They are 'supply-side' factors and 'demand-side' factors.
Supply-side factors are relevant when a business is not able to fulfill product demand for the same cost as their competitors.
There is still a demand for the company's service or product, but it is available cheaper elsewhere.
Minimum wage restrictions stop the company from lowering employee wages and so the business can be forced to downsize.
Demand-side factors relate to drops in demand for a service or product provided by a business.
This affects the company's turnover and hence, they must reduce outgoings.
This is often achieved by cutting jobs.
An example of 'supply-side' is the outsourcing of call centres.
Many companies now opt for outsourcing call centre operations to countries like India, due to the vast difference in cost for the same service.
Some people are disgusted by this, but if you owned a call centre and could reduce overheads by as much as 50% would you not be tempted? Advancements in technology and telecommunications have made this possible, but it does have a detrimental impact on our own economy.
An example of 'demand-side' is the car manufacturing market.
Because of the perception that our economy is in crisis, some people are now reluctant to buy expensive new cars, opting for less expensive used cars, or putting off upgrading their automobile altogether.
If you have researched purchasing a brand new car recently you will have seen that there are exceptional offers available, as the manufacturers and dealerships are struggling to generate sales.
Although this is the situation there is little or nothing we can do about the situation.
However, by being conscious of it, we can explore alternative ways of generating additional income, taking advantage of industry trends.
If you have ever considered building your own business then you would benefit greatly from identifying the impact that technology and the Internet is having on industry and business.
What you may notice is that most successful businesses today rely on the Internet to market and promote products.
This enables them access to a world market and with the advancing information age it is necessary to harness the Internet as often as possible! I am confident that this article provides you valuable insight, if you consider starting a part-time business at a later date.
