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by Edwin Mwai|2012
Unemployment is a situation many of us are familiar with, especially during these unpredictable changes in many economies today. Almost every person has faced unemployment at one time or another in their lives. The situation is made worse by the rising population in the world and more so if many do not have skills or education at that.
The causes of unemployment and consequences are many and they are discussed in the section that follows.
The Causes and Consequences
The causes of unemployment and consequences are brought about by many factors. For starters, one major cause common in most societies is economic imbalance. To add to that, a consequence that comes with this is that many individuals are left feeling frustrated and dissatisfied with their lives since they are forced to be unproductive.
Another common cause of unemployment is inadequate demand for goods and services. Some can argue that this is expected in a scenario where many people do not have jobs and hence less money to spend on some products and services. Yes, that is a fact. What is also true is that the dynamics of any economy depend on a steady flow of the demand and supply chains. Though this should not affect the wages earned by the employees of a company, less demand for a product or service offered by a company will mean high overhead costs a consequence of which may be massive layoffs or worst case scenario a shutdown of the entire company creating high unemployment in the process.
Other probable causes of unemployment include lack of efficiencies in the labor market and structural problems as well. In connection with the labor market, minimum wage laws and regulations imposed may play a part in unemployment as well. No economy wants to have high levels of these causes of unemployment as they only serve to drag it backwards.
A person without a job may find it hard to meet his/her obligations financially. This includes catering for one’s basic needs as well as expenses like house rent, loans and so forth. Their living standards will definitely decline. As a result, many individuals take up jobs that do not match their academic qualifications, skill set or experience. Mental stress resulting from the psychological torture of not having a job to earn a decent living and underemployment are other serious unemployment consequences.
The causes of unemployment need to be analyzed carefully in order to best curb this scourge and its many undesirable consequences. The only good news about it is that some countries like the United States offer unemployment benefits to people who have lost their jobs, after having fulfilled certain criteria. Nevertheless, this measure is just a temporary one.
Being unemployed can be the most difficult time of your life. That’s why Unemployment.info was created – to make things a little easier. Whether you need to file for unemployment, need help with your job search, or need information on unemployment benefits, Unemployment Info Center is your one-stop unemployment resource!