Question

what are the effects and consequences of unemployment on clients and society

Answer 1

Effects of Unemployment on Society

Lower GDP for the economy. High unemployment indicates the economy is operating below full capacity and is inefficient; this will lead to lower output and incomes. The unemployed are also unable to purchase as many goods, so will contribute to lower spending and lower output. A rise in unemployment can cause a negative multiplier effect.

Increase in Social Problems

High youth unemployment will result in crimes, social and political unrest. Such people will be unsatisfied with government and will loose faith in system and may resort to illegal activities of earning money like gambling, smuggling and other crimes.  It can lead to alienation and difficulties in integrating young unemployed people into society.

Political Instability

Mass unemployment may lead to formation of groups and parties which may oppose government and take steps to harm the economy. The period of1930 is one such example. Massive unemployment in Germany resulted in rise of Hitler and formation of Nazi Party.

Effect on Clients

Unemployment can prove to be disastrous for the unemployed person himself.

Loss of Earnings

An unemployed person will not earn any income. This will result in poverty and debt trap. This will further increase poverty in economy.

Homelessness and Basic Necessities unfulfilled

A person who is unemployed will be unable to fulfill basic necessities of food , clothing and shelter as he has litttle or no income. This results in a life full of hardships.

Dark Future Prospects.

A person remaining unemployed for a long period of time will find it difficult to find job in future. If people are made redundant in a recession, then they may become demotivated and lose on the job training, which makes them less employable. After a period of unemployment, it is harder for them to find work. Also, firms may be more reluctant to take on workers who have been unemployed for a certain period.

Loss of Human Capital

An unemployed person will be unable to develop his skills due to lack of training and proper job environment.  If someone is out of work for two years, they miss out on the latest working practices and trends.This is a vital component of human capital and labour skills; high rates of unemployment can reduce labour productivity. Unemployment affects the social and economic confidence of a person as he may feel downgraded and insulted.

Health Problems

Unemployment gives rise to many health problems like stress, anxiety, depression, suicidal thoughts and substance abuse etc which further worsen the situation.

Uncomfortable Retirement and negative effect on next generation.

Immediate effect of unemployment includes low or no income. But in long term also person is unable to save enough money for comfortable retirement. The person is unable to fulfill the needs of dependents. Parents who remain unemployed for long will be unable to provide proper education to children thus resulting in dark future prospects for children also. In this way Unemployment affects next generation also.

To conclude unemployment is disastrous both for the unemployed person and economy. Concrete steps should be taken both by citizens as well as government in combating unemployment.