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# Policies to reduce structural unemployment
- URL: https://www.a-level-economics-tutor.com/policies-to-reduce-structural-unemployment/
- Published: 2026-08-30T14:01:58.000Z
- Updated: 2026-08-30T14:01:58.000Z
- Author: Jaisul Naik
- Tags: Model Paragraphs

Training schemes Infrastructure 

One way to reduce structural unemployment is through increased spending on education and training schemes. Structural unemployment is a form of long-term unemployment where there is a mismatch between the location or skills of workers and the available jobs. Increased spending on education and training can allow workers to improve their existing skills, or re-train entirely. This increases occupational mobility of labour in labour markets, and reduces any mismatches in skills. For example, the government has recently introduced T-Levels, which allows 16 to 18 year olds to gain technical qualifications. This increases the number of young people available to work and helps to reduce the number of young people who go to university and gain skills that are less relevant to the current job market. Overall, this reduces structural unemployment. Additionally, due to more skilled workers, the productive potential of the economy will increase, shown by a rightward shift in the long-run aggregate supply (LRAS) curve. This leads to a decrease in the price level from pl1 to pl2 as there is the same demand chasing more goods and services. Also, this causes an increase in economic growth from y1 to y2.

![Increase in Long-Run Aggregate Supply diagram for A-Level Economics](https://storage.ghost.io/c/c4/66/c466eade-2ad5-4613-8010-7a8ffa8c352f/content/images/2026/08/CleanShot-2026-08-09-at-20.07.54@2x.png) 

Opportunity cost Time lag 

One way to reduce structural unemployment is through increased spending on infrastructure. Structural unemployment is a form of long-term unemployment where there is a mismatch between the location or skills of workers and the available jobs. In particular, the government could increase spending to improve transport links. For example, the government have spent close to £40 billion on HS2\. When complete, this would make it much easier for workers and businesses to commute to job opportunities that are further away, without needing to relocate. Overall, this reduces structural unemployment. Also, the economy can benefit from an increase in the productive potential due to the increase in geographical mobility of labour, shown by a rightward shift in the long-run aggregate supply (LRAS) curve. This leads to a decrease in the price level from pl1 to pl2 as there is the same demand chasing more goods and services. Also, this causes an increase in economic growth from y1 to y2.

![Increase in Long-Run Aggregate Supply diagram for A-Level Economics](https://storage.ghost.io/c/c4/66/c466eade-2ad5-4613-8010-7a8ffa8c352f/content/images/2026/08/CleanShot-2026-08-09-at-20.07.54@2x.png) 

Opportunity cost Time lag 

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