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Readers Respond: What Causes Unemployment?

Responses: 57

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Unemployment is caused when someone is laid off, fired or quits -- and is still looking for a job. This type of natural unemployment always occurs, even in a healthy economy. If someone retires, goes back to school or leaves the work force to take care of children or other family member, that is not unemployment. Also, if someone gives up looking for work, they are also not counted as unemployed by the Federal government. For this reason, some people say the government undercounts the real unemployment rate.

Sometimes unemployment is a result of advanced technology, such as computers or robots, which replaces worker tasks with machines. If the workers are not retrained, they may not have the skills needed to get a new job. This is known as structural unemployment.

Unemployment can also be caused by job outsourcing, when a company moves its manufacturing or call centers to another country where labor costs are cheaper. This occurred in many states after NAFTA was signed in 1994. It was also caused when workers in China and India gained the skills needed by American companies.

Large scale unemployment is caused when consumer demand slows enough that businesses lose too much profit. If they don't expect sales to pick up anytime soon, they then must lay off workers. This usually happens during the recession phase of the business cycle.

Compare the U.S. Unemployment Rate by Year

However, unemployment from the financial crisis of 2008 just won't let up. What caused it? Was it Wall Street bankers? Government economic policy? What do you think? Share Your Opinion

Why does unemployment increase?

It because people don't pay attention to the word of the most high ...God
—Guest Ntsiapane Alina Dimakatso

causes of unemployment

poverty, illitrate ,unemployment is also caused by job outsourcinng when company moves it's manufacturing or call centers to another country.
—Guest Thashfiya.N

Cure for unemployment

- to continue, it is disgusting for people to making millions of dollars a year when there are people who are unemployed and even starving. Mitt Romeny for instance made 21 MILLION dollars last year and paid a measley 12.8% tax on it! (The average American pays 30% tax) No Eisenhower had the right attitude, once you are making so much money, you should make a substantial contribution to the country making you so rich. A million a YEAR!! That is as much money as most people make in their lifetime! Tiger Woods makes $100 million a year - playing golf! Other people work hard, collecting our trash for instance, or teaching our children, policing our streets etc and make $30,000 to $40,000 a year while some "Star" plays Golf or Basketball, and makes millions. Or take bankers who use OUR money to make bets with and get bonuses of $10 million or $50 million or MORE for "Doing a good job"! Of what? Of robbing us! And again paying hardly any tax. Sickening.
—Guest David

Cure for unemployment

The cure for unemployment is simple - higher taxes. Look back over the years and you will see that the higher the taxation rate is the LOWER is the unemployment rate! For example, go back to the Presidency of Eisenhower when the top tax rate was 90% and unemployment was as low as it has ever been. Taxes dropped over the years and unemployment went UP. Reagan arrived and raised taxes 17 times, (He also quadrupled the National Debt! But that is another story.) and unemployment went down. Since then taxes have gone down, down, down as steadily as unemployment has gone up, up, up! We are now at one of the highest rates of unemployment and guess what - taxes are at the LOWEST that they have been in over 60 years! We have not had such a LOW rate of taxes for more than 60 years AND a very high unemployment rate. Answer is simple, raise the tax rates. Once someone is bringing home a million dollars a year he should be paying 90% tax on everything over 1 million. It is disgusting for people to
—Guest David

RESERVATION FOR SCHEDULE CASTES OR TRIBE

DUE TO RESERVATION SOME IGNORED PEOPLE GET EMPLOYED AND OTHER INSTEAD OF BEING INTELLIGENT REMAINED UNEMPLOYED
—Guest SHIVIYA

Voluntary unemployment

Some pple voluntarily choose to remain without work,therefore remains unemployed
—Guest Muturikwa 04

Over population

This is common most mega cities where people are over-crowded.It should be noted that labour market can not absorbed everybody especially when the area is over populated.
—Guest Kolade Rotimi

Corrution

Corrution is the crucial tools that causes umployment.when the government only enrich themselfs..money set aside for facilities and the warefare of citizen is been hijack by the so call politicial,,,it result youth involement into terriorism.
—Pharrel

seasonal changes

Most jobs that are of seasonal nature for instance farming the worker or employees stay without work some time because the season doesn't allow performing a particular task say planting
—Guest Mwogeza Joseph

shaikh

there is unemployment all over that world beause of populatin and, corruption, and beause of corrupt politicians.
—Guest ali asghar shaikh

Good Job

This is one of the few articles I've seen on this subject in recent years which actually presents correct economic reasoning and citations. Good job. (Economics Ph.D. 1996 University of Wisconsin-Madison)
—Guest Dr. John S. Harvey

NEPOTISM

Please, thank you very much for enumerating some of the causes of unemployment. I think NEPOTISM should not be one of the causes because the people under the nepotism are also part of the people that need to be employed, irrespective of their educational background, socio-economic background or any societal issue. Anyway, for my examination purpose, I have to accept it and probably conduct a research into that. Thank you.
—Guest Mickey Darling

Economic recession

African countries are plagued by continuous economic recessions which result from government instability.This leads to unemployment in that TNCs will move their investments to other stable states thus leaving the majority of African populations retrenched and jobless.
—Guest Melissa Mutukura

Causes of unemployment

In addition to aforemention causes. Poor infrastructure and our graduate lack confident in the area of their profession because poor studies environment.
—Guest Papisky

Lack of technical imputes

Lack of technical inputs has also contributed to unemployment.Government should encourage the interest of technical education and good technical facilities to boost technologies and skills.
—Guest Sandra

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What Causes Unemployment?

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