Question

Which type of unemployment would increase if workers lost their jobs because their positions were replaced by an automated process?

Answer 1

Structural Unemployment

Unemployment is the major issues that determine the economy of a country. Technological unemployment is caused due to the commencement of technology and machines that take over the job which could be previously accomplished by human processes. While the introduction of technology would certainly involve innovations and cancel any error that would be possible by humans, it would lead to the displacement of human labor. Technological unemployment is one of the best examples caused by structural unemployment. The takeover of human production by automated processes can either lead to an increase in unemployment, which can cause serious problems in the economy or avoid this, alternate employment opportunities will have to be provided to the unemployed people

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Further Explanation-

There are two types of situations that can occur due to technological employment. Firstly, one can be short term unemployment, which is widely observed in the economies of almost all countries. There is compensation paid to the workers who lose their jobs and they are provided with alternate economic opportunities. This is a sign of a healthy economy, where a positivist approach is noticed. A short-term disruption is considered to be necessary for technological advancement and economic development. Also, it solves the issue of growing unemployment. It also has to be observed that the economic opportunities provided to the workers losing their jobs should be able to offer them a similar subsistence level so that they are able to subsist in similar living conditions as they had with their previous job. The other situation is a pessimist situation, in which the country's economy suffers from additional unemployment, and there are not enough opportunities for the workers to lead a similar lifestyle. They are forced to poverty. This is a sign of economic stagnation, and technological development is associated with long term negative effects on the economy.  

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Answer Details-

Grade- High School

Chapter- Types of unemployment.

Subject- Economics

Additional Remarks- This chapter describes the effects of technological advancement on the economy of a nation.

Keywords-

Economy, technology, displacement, living conditions, pessimist, optimist economy, compensation, economic stagnation.

Answer 2

This example of unemployment is associated with "Structural Unemployment". This type of unemployment is related to changes in market conditions. In this case, the greater demand for cars has made it necessary to improve the production process in order to increase the output of new cars. This automated process aims to achieve this at a lower cost, in comparison to having several employees whose total wage bill is probably higher than the operating costs of the new machines.