Exploring Unemployment, Essay Example

The reasons that we have high rates of unemployment are numerous and complex. One straight-forward explanation is that of the economics ‘supply and demand theory’ i.e. there are more people (supply) than there are jobs available in the market place (demand). From the end of World War 2 the ‘baby-boomers’ have monopolised the job market for the last 45 years. Most of this workforce is now heading for retirement, however because of the shortfalls in pension schemes and the financial crisis people are suspending retirement and continuing working. This has been propped up by advances in technology and medicine that enable us to both work and live longer. This has had the impact of reducing the job opportunities for the generation behind them.

Another key issue relates to that of globalization and the reduction of foreign trade “A decrease in orders of American products forces US companies to cut back production and lay off workers” (Zastrow, 2010).

In order to reduce the impact of unemployment we need to stimulate the economy with more investment and increase the confidence of consumers to spend money. This impacts interest rates, for example:  when these are low people will borrow money for capital investment that will lead to expansion of their business and such normally results in increased production and employment.  Economics is often complex and difficult to predict outcomes. For example: tax cuts always tend to stimulate the economy and lead to increased employment. However, it is a fine balance as it may equally contribute towards a Federal deficit and in turn drive up inflation and subsequently unemployment. “Kornblum & Julian also tell us in their essay that the unemployed feel isolated, friendless, incompetent and worthless” (marsayas, 2009).

Works Cited

Marsayas, s. (2009, 2 21). Market Damage. Retrieved 10 30, 2010, from Ritual Booth: http://ritualbooth.com/

Zastrow, C. (2010). Introduction to Social Work and Social Welfare: Empowering People . In C. Zastrow, Introduction to Social Work and Social Welfare: Empowering People (p. 368). Belmont CA: Brooks Cole.