The Pros And Cons Of Unemployment

This data collection should allow this study to acquire an acceptable level of trustworthiness, even when taking into considerations some limitations that may occur. Section 1: Introduction

Introduction

Unemployment as an economic problem exists in each countries and it is often a measure of the health of the economy. It is known as waste of scarce economic resources and as a result it decreases the future growth potential of the country’s economy (Riley, 2005). It is essential to understand the factors which causes the unemployment and its relation and impacts to other economic issues. For instance, of the causes are considered the extreme unemployment benefits, excessive minimum wage and hiring cost, too high real wages level, the disparity between the unemployed labour and job offers on the market in terms of skills and many others reasons (Bell, 2000). At the same time unemployment impacts the economy and the society. Economy experiences decreased spending power of the families and extra expenditure on unemployment benefits, the society meets changes in the mental health, crimes and violence, standard of living and others.

There were many studies conducted on dependencies and mechanisms of unemployment. Unemployment can explained by many factors as well as inflation. As one of the reasons of unemployment, inflation within the country can be considered. According to Phillips (1958) the inflation and the unemployment are tradeoffs, thus, the countries with lower