Unemployment is one of the most profound issues a nation or an economy may face on a macroeconomic level. At an individual level, unemployment may cause severe impact on the living standard followed by psychological distress as well. Economists tend to focus on the causes of unemployment to reduce its repercussions and find solutions for the unemployed workforce.
Different reasons and causes could lead to unemployment, and therefore the economists have divided unemployment into three main types. If it is caused by the time it takes to find a new job or a graduate student looking for his first position, then it is called frictional unemployment. The second and more harmful unemployment type is the cyclical one which is induced when the "overall demand for goods and services in an economy cannot support full employment" like in a case
…show more content…
Workers who lost or about to lose their jobs shouldn 't be left forgotten to avoid the social and psychological adverse effects of unemployment. Structural unemployment cannot be solved by a fiscal or monetary policy. Alternatively, here are some general solutions suggested to recover from it; First with governments investing in education and increasing its level to match with the actual technological progress and adapt to the rapidly changing economic conditions, like it has been done in South Korea and south-east Asia. Furthermore, governments ' involvement is also needed by providing training programs for unskilled unemployed workers, and subsidies to companies that supply training to their employees affected. Housing subsidies could also be beneficial to workers in need to relocate to expensive areas due to structural unemployment. Implementation of apprenticeship like in Germany may also help keep the workers up to date with the technology and reduce lay-off for the long