Unemployment rate in an economy exists when number unemployed equals those of working age who are without work but who are available for work at the current wage and are actively seeking work (McTaggart 2010). When a country has a high unemployment rate that means an economy is underutilising the resources. Currently Australia’s unemployment rate is at 4.9% which is the lowest in the industrialised world. Bur however, in developing countries the unemployment rate goes up to 35% which is unfortunate. Countries that have the highest unemployment rates are listed below:
- · Zimbabwe-95%
- · Liberia-85%
- · Vanuatu-78.21%
- · South Africa-25.3%
- · Spain-20.4%
When Unemployment Rates are high the government have to give benefits. The disadvantage of this is that the money which can be used for other important projects such as: infrastructure, education, defence, health is now used for unemployment benefits. Furthermore, unemployment creates poverty and income equality and wastes some of the scarce resources used in training workers (Anderton 2003). Due to poverty and inequality people’s standard of living decreases. This is the main reason why unfortunate people exist in our society. People are unable to buy clothes or food and pay for education as a result of poverty and income inequality. However, some may argue that income differentiates according to individual’s skills. Different jobs required different skills. Nowadays if a person wants improve on their computing skills so that he/she could work in an IT company there are specific courses which focuses on that. The problem is that we can afford the courses maybe because our parents are doing better jobs e.t.c but it is unfortunate that some people cannot. This is why we exist. We provide in house training for these people and enhance their skills required by the job. Not only people’s standard of living increases when they are employed but also it would affect the economy as well.
Below is a video about current unemployment status in Australia
References:
McTaggart, D, Findlay, C & Parkin, M 2010, Macroeconomic, 6th edn, Pearson, NSW
Anderton, A 2004, Economics, 3rd edn, Causeway Press, UK
It's true that Unemployment affects the economy. You guys are helping to reduce unemployment this means that the government can reduce on unemployment benefits and use that money to focus on something else like education or health. This could be a solid point for you to bring it to the government so that the government can give you grants.
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