Structural unemployment—the unemployment that remains even at the peak

Hi! Let me try.
First D is mentioned in the passage here:
While technological advance almost invariably results in shifts in demands for different types of workers, it does not necessarily result in unemployment. Relatively small or gradual changes in demand are likely to cause little unemployment. In the individual firm or even in the labor market as a whole, normal attrition may be sufficient to reduce the size of the work force in the affected occupations. Relatively large or rapid changes, however, can cause serious problems.

When does unemployment occurs? When there is downward shifts in demand. But when this downward shift is small, passage says that it won't result in unemployment. Rather, firms may chose to "fire" few employees. Firing few employees (attrition) is not similar to unemployment-a situation caused by mass layoffs by multiple firms!
This is what D says: normal attrition is sufficient to reduce size of work force. No mass layoffs necessary to counter the change-if it is small.

Does it make sense?
Now I am not GMATNinja, but tried to help

Hi I answered why D is correct in above post. Please refer it.
Now why B is not a good enough option:



Consider yourself CEO.
See this conversation:
Scenario D:
I (reporter) : Why aren't you giving pink slips to all employees (causing unemployment), given we have seen small downward shifts in demand for labor?
You: Because removing few people (normal attrition) is enough to tackle this small shift.

VS.

Scenario B:
I (reporter) : Why aren't you giving pink slips to all employees (causing unemployment), given we have seen small downward shifts in demand for labor?
You: Because the shift is occurring slowly.

Does it matter whether the demand lowers slowly or quickly? Passage says the small shift won't cause employment. Why? Because normal attrition is enough to counter these small shifts. Passage doesn't mention anything about how slowly or quickly the shift occurs and its effect on unemployment!


Hope I helped!

Need a help on answering (Book Question: 8)

The passage suggests that the phenomenon of combined unemployment and inflation is
A. a socioeconomic problem that can only be addressed by government intervention
B. a socioeconomic problem that can be characteristic of periods of structural unemployment
C. an economic problem that results from government intervention in management-labor relations
D. an economic problem that results from imperfect applications of technology
E. an economic problem that can be eliminated by relatively small changes in the labor force

I could not reach to choice B anyhow... please help which line can lead to this answer in last para

Thanks in advance!!

You can try eliminating one by one
A- contains only. Extreme generalisation
B- characteristics of stru. Unemployment.
C- First and second para never says govt has done anything to create this
D- technology is one factor but problem exist without technology.
E- not small changes but type and location both matters

Posted from my mobile device

For me, choice B is from the following evidence:
This phenomenon may be an important factor in the rising trend, observed for the past two decades, of unemployment combined with inflation

in the passage, "this phenomenon" is that: Increased structural unemployment=>wages of shortage qualified workers are bid up, labor costs, and thus prices, rise.
the passage tell us that "this phenomena" is important factor to create a trend: "combined unemployment and inflation"
So this trend is characteristics of structural unemployment.
Analogy: people who have flu usually cough. So cough is a characteristic of flu.

Hey there!

Can someone please help me on the last question - Question 10? I can't seem to understand why B is not a good enough option. The answer D is clearly cited in the passage, but it does not seem like a solid explanation for the question. While B is a concise, direct answer and that makes much more sense.

Thank you in advance.
Marina

(Book Question: 10)
According to the passage, small downward shifts in the demand for labor will not usually cause unemployment because
A. such shifts are frequently accompanied by upswings in the economy
B. such shifts usually occur slowly
C. workers can be encouraged to move to where there are jobs
D. normal attrition is often sufficient to reduce the size of the work force
E. workers are usually flexible enough to learn new skills and switch to new jobs

In the above question, how is option D the correct answer? Can anyone explain? GMATNinja
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Hey!

Thank you so much for the complete explanations, I completely understand now.

It makes a lot of sense, I think I didn't get the meaning of the text correctly and that is why I got the wrong answer.

Also, the examples were perfect, thanks again!

Marina


Sent from my iPhone using GMAT Club Forum mobile app

P1 - wat is SU?
P2 - factors affecting SU + job loss is not bad. why?
P3 - effects of above thing

RC00144-03
All of the following are mentioned as ways of controlling the magnitude of structural unemployment EXCEPT

Workers can be encouraged to move where there are jobs, to reeducate or retrain themselves, or to retire. In addition, other factors affecting structural unemployment, such as capital movement, can be controlled.

A. using public funds to create jobs - correct; except this all are given in P2
B. teaching new skills to displaced workers -
C. allowing displaced workers to retire -
D. controlling the movement of capital -
E. encouraging workers to move to where jobs are available -

-------------------------------------
RC00144-04
The passage suggests that a potential outcome of higher structural unemployment is
As the wages of those workers are bid up,
C. higher wages for those workers who have skills that are in demand - yes

--------------------------------------

RC00144-05
It can be inferred from the passage that even when there are unemployed workers, labor shortages are still likely to occur if

If there is a growing pool of workers who lack the necessary skills for the available jobs, increases in total labor demand will rapidly generate shortages of qualified workers.

D. the jobs available in certain places require skills that the labor force in those areas lacks
----------------------------------------
RC00144-06
The passage suggests that the phenomenon of combined unemployment and inflation is

This phenomenon may be an important factor in the rising trend, observed for the past two decades, of unemployment combined with inflation. Government policy has placed a priority on reducing inflation, but these efforts have nevertheless caused unemployment to increase.

A. a socioeconomic problem that can only be addressed by government intervention - too extreme, not sure if it can be addressed by that.
B. a socioeconomic problem that can be characteristic of periods of structural unemployment - unemployment and inflation can be characteristic of SU.
C. an economic problem that results from government intervention in management-labor relations - no
D. an economic problem that results from imperfect applications of technology - not always.
E. an economic problem that can be eliminated by relatively small changes in the labor force - not always.

---------------------------------------

RC00144-07
The passage is primarily concerned with

A. clarifying the definition of a concept - p1
B. proposing a way to eliminate an undesirable condition - weak
C. discussing the sources and consequences of a problem - best of the lot.
D. suggesting ways to alleviate the effects of a particular social policy - no
E. evaluating the steps that have been taken to correct an imbalance - no

-----------------------------------------

RC00144-08
According to the passage, small downward shifts in the demand for labor will not usually cause unemployment because
In the individual firm or even in the labor market as a whole, normal attrition may be sufficient to reduce the size of the work force in the affected occupations.

D. normal attrition is often sufficient to reduce the size of the work force

I don't know if this passage should be a 600-700 passage. I have seen way more difficult passages in this category.

No problem is there with the difficulty level tag this is a 600 Level question

Thanks

Hi,

Just a small addition, attrition is both 'firing' and people leaving on their own.


Thanks
Saurabh

In the first question, I was confused between A and C. I did choose option A over option C. I chose A because of the word create jobs. In option C, to retire is mentioned, but I was confused with the word displaced. Nowhere it is mentioned for displaced workers. Though displacement word is used, it isn't applicable for workers.

Refer to the above sentences taken from the reading passage. Notice that there is a pronoun "this" at the beginning of the latter. "This replacement" refers to "the worker's replacement" in that sentence.

I hope it helps.

Kudos if you liked this post.
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Hi Marina.

Please refer to the following section of the passage:



It is evident that these changes may not always be gradual (consider "or"). But what Option D suggests is clearly mentioned

Hope that helps!

While technological advance almost invariably results in shifts in demands for different types of workers, it does not necessarily result in unemployment. Relatively small or gradual changes in demand are likely to cause little unemployment. In the individual firm or even in the labor market as a whole, normal attrition may be sufficient to reduce the size of the work force in the affected occupations. Relatively large or rapid changes, however, can cause serious problems.

Hi AndrewN Sir

The question seems simple yet confusing.

The question asks: low demand of labor workers will not cause unemployment - why?
Mind says it still creates at least some unemployment but as given in passage ", it does not necessarily result in unemployment." I move on to answer the question:

When I read D: normal attrition is often sufficient to reduce the size of the work force.
I can't understand how attirition is the reason for not causing unemployment. Infact it seems after low demand , attrition is adding further to unemployment.
(attrition : remove workers and not replaced )
In passage , statements are given as facts one after another. I don't know how can I make it as cause ( because)

What Important piece of logic am I missing here ?
That's why the question seems simple yet confusing for me:(

Thanks!AndrewN

Hello, mSKR. You ask a question that touches on a point that a client of mine brought up during a recent lesson: how do you identify a premise or conclusion in a passage? We were talking about CR, but the snippet of text you quoted above fits the bill. Ask yourself if you could place a because or a therefore ahead of the sentence to run a quick identification test: because introduces a premise, therefore a conclusion. If we take the first sentence as more informational or contextual, we can then test subsequent sentences in the manner I have outlined:

While technological advance almost invariably results in shifts in demands for different types of workers, it does not necessarily result in unemployment. [Because/Therefore] Relatively small or gradual changes in demand are likely to cause little unemployment. [Because/Therefore] In the individual firm or even in the labor market as a whole, normal attrition may be sufficient to reduce the size of the work force in the affected occupations. [Because/Therefore] Relatively large or rapid changes, however, can cause serious problems.

The first and second sentences do indeed provide "statements... given as facts one after another," but that third sentence really seems to offer an explanation for the second, answering the question, Why are relatively small or gradual changes in demand likely to cause little unemployment? The final line from the excerpt goes back to adding another statement or claim: neither because nor therefore will work. It is this relationship between the second and third sentences that allows us to arrive at the correct answer to the question.

Remember, you should be able to find the answer directly in most according to the passage questions. In this case, the keywords from the question stem pair up nicely with those in the excerpt you quoted, but the missing link appears to have been an inability to identify the premise or support for the statement given in the second sentence.

I hope that helps clarify the matter. Thank you for thinking to ask.

- Andrew
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Hi AndrewN sir

Although it seems still little confusing to me , I thought 2 below points:
Please correct my understanding.

1.
The question is : why reduce in demand doesn't cause USUALLY unemployment (will not usually cause unemployment because)
little reduction in workforce or technology change doesn't cause serious problem ( maybe cause little unemployment- small or gradual changes in demand)
Relatively small or gradual changes in demand are likely to cause little unemployment.)
this little unemployment can't be considered usual unemployment.

2.After reading your analysis, I linked these 2 statements as below: (Relatively small or gradual changes in demand are likely to cause little unemployment. In the individual firm or even in the labor market as a whole, normal attrition may be sufficient to reduce the size of the work force in the affected occupations. )

So it means normal attrition remove a number of workers. This number of workers is higher than the number of workers removed due to relatively small or gradual changes in demand .
That's why remove of workers due to change in demand actually can not be considered as unemployment.

Is my understanding correct?


Please suggest AndrewN sir.

Hello, mSKR. I would say that your approach still seems overwrought. You appear to be reading into each sentence for more meaning when the task with standardized test questions is to get in and get out, to walk away with the answer without doing too much work. (Save those brain cells for tougher challenges.) My message may not have been clear enough earlier. By identifying the premise in the middle of the excerpt, you can read the two lines back-to-back and effectively insert because between the lines in question, and since the question fits this very frame, we know we have our answer. Take a look at the question stem again:


Now, take a look at the excerpt you quoted before, but with because inserted:


Notice that what follows or even comments on the entire labor market. The only answer that fits the keywords of the premise we have identified is (D), nearly verbatim at that (only swapping out may be sufficient for is often sufficient). You could have no idea what attrition was, and you should still be able to walk away with the correct answer. I did not bother going any deeper than scratching the surface, and according to the passage questions frequently lend themselves to being solved in such a manner.

You do not have to get to the bottom of everything or think in real-world terms to answer such a question quickly and with relative ease.

- Andrew
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