Isn't long-term permanent-employment unrealistic?

[DarrenD4406]

All modern economies are founded on the premise that the objective should be to have all able-bodied people working full time. However, as we become more efficient in each sector, the % of the population required in that sector diminishes. This can be seen with agriculture in America. Around the turn of the 20th century, over 1/2 the population was required to work in agriculture. Now that figure is less than 2%. With each wave, labour resources are deployed from the old sector into the new sector. However, each new sector appear to require less people. For instance, as manufacturing technologies improve, less people are required in factories, freeing up workers for the next sector. One of the problems is that each sector requires an increasing level of skill, which may exempt certain people from qualifying. Since those people are surplus to requirements for the previous sector, how can full employment be theoretically possible?

[Sema-EU5476]

Full employment isn't possible, there is term as "Natural rate of employment". some workers will need to spend some time for searching new job (frictional unemployment), some will need to change qualification/profession (structural unemployment).Your assumptions are also close to reality but some changes should be taken into account - not all population actually works (for instance in my country only about 63% work in age between 18 and 65). Labor are not just dissmissed, with improving tecnology we don't just produce same amount - it's actually incrasing, so technology frees some people but they are involved anyway by increasing quantity produced.

[GiorgosK]

Very interesting question and very realistic one.An economy cannot achieve permanent full-employment because of many factors:First of all, every economy has business cycles. During a recession, we cannot have full-employment. What we can do is to take measures to lower the unemployment of the recession (expansionary fiscal and monetary policy), but this policy will be effective in the middle-run.After that, as you well noticed, every economy at some times faces structural unemployment. This is due to technological improvement, economies of scale, use of more capital than labor, etc.What we are trying to do in economics is to keep the objective of full-employment; thus, to take measures in order to be as close as we can to this level (for example, to achieve competitive advantage, to allocate resources in an efficient way, to stimulate investment, reeducation planning, etc.).I hope this helps