Tuesday, January 22, 2013
U.N. Agency Warns of Rising Unemployment
The United Nations said on Monday 197 million people worldwide are jobless, and an additional 39 million have given up looking for work. As we all know, high unemployment rates in the developed world weigh on demand and hold back economic growth. The UN blames the governments trying to balance their budgets for such high worldwide unemployment. Many governments tried to counter the financial crisis with fiscal stimulus, which resulted in a deeper recession for many countries. Today, many people in the developed nations are leaving the job market altogether. The labor force participation rates are falling dramatically and masking the true extent of the jobs crisis. Therefore, the International Monetary Fund's Director is urging governments to focus on "growth that can actually deliver jobs."
Subscribe to:
Post Comments (Atom)
Do you think the UN or the IMF should take intervening actions towards the economies of these various struggling nations? Or, more importantly, what can the governments of these nations do to stimulate job growth? In my opinion, the words of the IMF Director seem very vague and unspecific, and could ultimately lead to poor fiscal decisions on the part of the governments. After all, how can a state deliver "growth that can actually deliver jobs" if they do not know what that is? A specific, calculated, state-by-state action plan is necessary if any real growth is to be achieved, and the IMF should be spearheading these specific plans.
ReplyDeleteIt seems as though there will continue to be unemployment issues until the underlying problems in the economy are fixed. Economies in the Eurozone and in the US are still struggling to recover and get out of the recession. Until there is more confidence in the market it will be difficult to resume growth in the economy because businesses are wary to invest money into the economy.
ReplyDeleteNo, I don't necessarily think the IMF should take any intervening actions towards these struggling nations. However, I think the Director could do a better job of explaining what states are making a positive impact on the unemployment rate and how they are doing so. Take Ohio for example - it shows a growing economy, specifically with an unemployment rate of just 5.5% in Columbus. What is working so well in Columbus? Lastly, I agree we need more confidence in the market in order to encourage more spending from businesses. Perhaps the extension on the fiscal cliff will provide more opportunity for the economy to become more stable.
ReplyDeleteUnemployment is a very difficult thing to tackle. A lot of people think they can work above their qualifications (i.e high school graduates competing with college graduates), though they may be a better fit for the job, most employers will go with the person who has invested more in themselves with the college education. Others think a job at McDonalds is "below" them so they would rather just not work than to work at a job like that. I think there comes a point when there just aren't enough "good" jobs for our entire population and we have to be happy as a whole with unemployment around 7-9%, since the natural rate is between 4-5%.
ReplyDelete