unemployment

Unemployment: Reasons and possible solutions

by Wes Moon

Employment can be explained as the state of being employed or occupied in a job that pays the employee money. Which would mean that unemployment could be defined as the state of being unemployed or out of a job. High rates of unemployment are an indication of poor national economic performance.

            The United States are a highly developed country who are also regarded as a world superpower, but no matter how powerful the U.S really is, it also suffers from a high amount of unemployment, which has been an ongoing issue for the U.S government.

            Reasons for high unemployment in the United States are very broad. There are many that can be explained and many that can’t.

            The rising population in the country has led the ratio or percentage of people who are unemployed to increase. Jobs do not increase with the increase of population in the country, which would mean that it would be logical for the amount of people unemployed to increase in such circumstances.

            Businesses in the U.S have been facing fierce competition with other businesses outside the country which makes it impossible for them to deal with it. When that happens it results in financial losses for that business and then leads to closure. As companies are closing down, employees are losing jobs which therefore results in higher unemployment rates.

            Another reason for higher unemployment rates is that a lot of companies are updating and automating their production facilities, which means that workers are being replaced by machines. This is known as “technological unemployment.”

            Also in the U.S there are businesses that are seasonal and those that are working in these seasonal businesses are being laid off after that certain season is over. This type of occurrence is called seasonal unemployment.

            Another reason for high levels of unemployment is because the younger generation is now trying to go to higher studies instead of taking up a job which leads to smaller companies who need people to do the “dirty work” to have less employees and leads to those higher levels of unemployment.

            In this past recession (2007-09) more jobs were lost than in the last four recessions combined. The number of lost jobs is something near 8 million. It is said that it will take until at least 2015 until we get back down to an unemployment rate of 6%. This 6% refers to a thing called “full employment” which means that somebody who wants and is looking for a job can find one.

U.S officials and politicians have come up with some ideas about how to possibly reduce unemployment rates.

            “Green jobs” is the most talked about way of reducing unemployment by politicians. These “green jobs would create new jobs in “environmentally correct” industries such as wind and solar power. But this thought is only the latest that builds on job creation through taxation, spending and regulation.

            “The only true way that the government can foster true job growth is to remove tax and regulatory obstacles to job creation in the private sector.”

              Even though there definitely are jobs created by new government spending compliance with government regulation, the main should be the net gain of new jobs. And usually when the government steps in to help out with their big schemes, the result is net job loss.