Unemployment is a serious issue that causes negative effects both for people and for the country and its economy. For instance, job search, minimum-wage laws, unions, and efficiency wages can all explain and contribute to why some workers do not have jobs. (Mankiw, 2012) Among the mentioned causes, some definitely negative impacts of unemployment are financial costs for the government and poverty. Proverbs 21:5 New Living Translation (NLT) states, “Good planning and hard work lead to prosperity, but hasty shortcuts lead to poverty.”
The first negative impact of unemployment is additional financial costs for the government. The higher unemployment rate in a country is, the bigger then unemployment compensations costs, lost tax revenue, service and social costs are. For example, according to a Congressional Budget Office an American government spent in 2012 around 520 billion dollars on unemployment compensation, which is quite high and might lead to worsening of an economic situation in general.
The second negative impact of this social issue is poverty. It is logical that poverty is a cause of unemployment because if people do not have jobs, they …show more content…
First of all, it leads to increase of government financial costs such as unemployment benefits, for example, because the more people are unemployed, the more money government will have to pay in order to support these people. Another negative impact is poverty. As it was proved already in this research paper, the concepts of unemployment and poverty are interrelate, which is quite logical: when people lose their jobs and become unemployed, they do not have enough money, and their expenses start exceeding their incomes, which leads to poverty. The idea is not to make a living from unemployment advantages but take advantage of the opportunities provided by the government to better the
The first negative impact of unemployment is additional financial costs for the government. The higher unemployment rate in a country is, the bigger then unemployment compensations costs, lost tax revenue, service and social costs are. For example, according to a Congressional Budget Office an American government spent in 2012 around 520 billion dollars on unemployment compensation, which is quite high and might lead to worsening of an economic situation in general.
The second negative impact of this social issue is poverty. It is logical that poverty is a cause of unemployment because if people do not have jobs, they …show more content…
First of all, it leads to increase of government financial costs such as unemployment benefits, for example, because the more people are unemployed, the more money government will have to pay in order to support these people. Another negative impact is poverty. As it was proved already in this research paper, the concepts of unemployment and poverty are interrelate, which is quite logical: when people lose their jobs and become unemployed, they do not have enough money, and their expenses start exceeding their incomes, which leads to poverty. The idea is not to make a living from unemployment advantages but take advantage of the opportunities provided by the government to better the