Unemployment

unemployment, condition of one who is able to work but unable to find work. Once assumed to be voluntary, idleness was punishable by law; however it is now recognized that unemployment often arises from factors beyond the control of the individual worker. Unemployment may be due to seasonal layoffs (e.g., in agricultural jobs), technological changes in industry (particularly by increased automation), racial discrimination, lack of adequate skills by the worker, or fluctuations in the economy. For the purposes of government statistics, a unemployed person is someone who is without a job and actively looking for work; a person without a job who is not looking or has stopped looking for work is not counted as unemployed. The unemployment rate thus is not an indicator of the percentage of people of working age who do not have jobs. The term underemployment is often used to describe the condition of those who work part-time because full-time jobs are unavailable or who are employed at less-skilled work than they are qualified to do.

In developing countries, unemployment is often caused by the urban migration that generally precedes the industrial development needed to employ those migrants. In industrial nations, increases in unemployment are the result of economic slowdowns, recessions, or depressions. In the Great Depression of the 1930s unemployment rose to 25% of the workforce in Germany, Great Britain, and the United States. Similar rates occurred in Greece and Spain, due in part to different causes, during the early 2010s.

In the post–World War II era most of W Europe and Japan generally kept their unemployment levels below 3%, and by the late 1960s the rate in the United States, where there had been far more fluctuation, was down to less than 4%. Since the 1970s, however, worldwide economic changes have generally kept the U.S. unemployment rate above 5%. It was greater than 10% in 1982, the highest rate since 1940, and the rate was considerably higher among nonwhite minorities and the young, approaching 50% among African-American teenagers in urban areas. By 1990 the average unemployment rate had dropped to almost 5%. It fluctuated between 5% and 7% for most of the 1990s but dropped to around 4% by 1999 before a recession (2001) led it to rise to 6.3% in mid-2003. It subsequently dropped to 5% by mid-2005 and hovered between 4.8% and 4.4% for most of 2006–7. By late 2009, however, it had risen to 10.1% as a result of the deepest recession since the early 1980s, and slowly dropped to near 6% by mid-2013. At the same time, however, many people left the workforce and were not counted in the employment figures. Underemployment and unemployment combined exceeded 17% in 2009, the worst such rate since at least the 1970s and perhaps since the Great Depression.

As Keynesian economics (see Keynes, John Maynard) gained influence among policymakers, more countries committed themselves to finding ways to approach full employment through government intervention. Governments, in addition to trying to increase employment opportunities by stimulating business, have also taken other measures to deal with the problem. In the United States, the Social Security Act of 1935 and the Employment Act of 1946 represented moves in this direction; in Great Britain, labor exchanges were set up and a contributory unemployment insurance system established. Under the Communist economic systems of the Soviet Union and the People's Republic of China, attempts were made to eliminate unemployment by socializing the means of production and distribution and by directing labor into more productive channels, but their governments typically proved unable to reallocate labor appropriately, leading instead to unneeded production or underemployment. The disintegration of the USSR and economic liberalization in China ended such efforts.

Bibliography

See C. A. Greenhalgh, ed., The Causes of Unemployment (1983); D. N. Ashton, Unemployment under Capitalism (1986); J. Hudson, Unemployment after Keynes (1988); L. H. Summers, Understanding Unemployment (1989); R. Vedder and L. Gallaway, Out of Work: Unemployment and Government in 20th Century America (1993).

The Columbia Encyclopedia, 6th ed. Copyright© 2014, The Columbia University Press.

Unemployment: Selected full-text books and articles

High Unemployment in the United States: Causes and Solutions
Tong, Carl H.; Tong, Lee-Ing; Tong, James E.
Competition Forum, Vol. 10, No. 2, July 1, 2012
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
High Unemployment after the Recession: Mostly Cyclical, but Adjusting Slowly
Tasci, Murat.
Economic Commentary (Cleveland), No. 2011-2, January 31, 2011
Current Unemployment: Cyclical or Structural?
.
Monthly Labor Review, Vol. 134, No. 4, April 2011
What Is Behind the Rise in Long-Term Unemployment?
Aaronson, Daniel; Mazumder, Bhashkar; Schechter, Shani.
Economic Perspectives, Vol. 34, No. 2, Summer 2010
Fighting Unemployment: The Limits of Free Market Orthodoxy
David R. Howell.
Oxford University Press, 2004
The Effects of Education on the Natural Rate of Unemployment
DePrince, Albert E.; Morris, Pamela D.
Business Economics, Vol. 43, No. 2, April 2008
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
Why Does Unemployment Differ Persistently across Metro Areas?
Rappaport, Jordan.
Economic Review (Kansas City, MO), Vol. 97, No. 2, Spring 2012
In Search of a General Model of Unemployment
Kooros, Syrous K.
Advances in Competitiveness Research, Vol. 16, No. 1/2, January 1, 2008
The Ins and Outs of Forecasting Unemployment: Using Labor Force Flows to Forecast the Labor Market
Barnichon, Regis; Nekarda, Christopher J.
Brookings Papers on Economic Activity, Fall 2012
Is the Natural Unemployment Rate Hypothesis Valid for the United States? Evidence from Recent Unit Root Tests
Murthy, Vasudeva N. R.
Indian Journal of Economics and Business, Vol. 11, No. 3, December 2012
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
Money and the Natural Rate of Unemployment
Finn Ostrup.
Cambridge University Press, 2000
Towards Permanent Insecurity: The Social Impact of Unemployment
McBride, Stephen.
Journal of Canadian Studies, Vol. 34, No. 2, Summer 1999
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
How Did Unemployment Insurance Extensions Affect the Unemployment Rate in 2008-10?
Mazumder, Bhashkar.
Chicago Fed Letter, No. 285, April 2011
Labor Market Rigidity, Unemployment, and the Great Recession
Tasci, Murat; Zenker, Mary.
Economic Commentary (Cleveland), No. 2011-11, June 29, 2011
Technology Shocks and Unemployment in the Last Recession
Amaral, Pedro S.
Economic Commentary (Cleveland), No. 2012-7, June 7, 2012
Unemployment Insurance and Job Search in the Great Recession
Rothstein, Jesse.
Brookings Papers on Economic Activity, Fall 2011
The Impact of Vocational Training on the Unemployment Duration
Landmesser, Joanna.
International Advances in Economic Research, Vol. 17, No. 1, February 2011
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
The American Dole: Unemployment Relief and the Welfare State in the Great Depression
Jeff Singleton.
Greenwood Press, 2000
Unemployment and Real Wages in the Great Depression
Solomou, Solomos; Weale, Martin.
National Institute Economic Review, No. 214, October 2010
PEER-REVIEWED PERIODICAL
Peer-reviewed publications on Questia are publications containing articles which were subject to evaluation for accuracy and substance by professional peers of the article's author(s).
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