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The Effect of Unemployment on Individuals and Society

Introduction

A countries unemployment rate is determined by the number of its unemployed citizens

within the working age. It is the ratio of unemployed citizens in the labour force, mostly

expressed as a percentage. The unemployment rate is an important figure monitored by many

bodies interested in predicting the trend of a nation’s economy (Monsef et al. 1020). In some

cases, a country's unemployment rate can be implied by comparing the number of graduates per

year and the number of job vacancies the government and other employers in the private sector

creates. A government that employs its citizens improves their financial power and eventually

the economy of the whole nation.

However, there are people in their working-age who have acquired skills without formal

training, and therefore they also have to be factored in to make the calculation accurate. The

unemployment rate is a subject of discussion in many forums because its impacts do not affect

only those who are not employed but extends to the rest of the society and the nation as a whole.

Therefore, when many citizens are rendered jobless, it should be every other citizen's concern

because they are affected indirectly yet at adverse levels.

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Effects of Unemployment on Individuals

Financial Effects

Unemployment may occur when a person fails to get a job despite having graduated from

a learning institution and being ready for labour. It may also arise when an employed person

loses. The second case of job loss poses a higher risk to the life of the victim of unemployment

than the first case, where there is no history of employment. When an individual loses a job,

many aspects of their lives change abruptly, and adjusting to the new way of life may become

difficult. For instance, the financial part of life changes so fast that the individual finds it

challenging to purchase necessities for self and family (Kramer & Amit 1320). In such a state,

individuals find themselves unable to support the essential aspects of their families, like

purchasing clothes, food, and payment of rental fees for those who are not homeowners.

In addition, education fees for children become a burden too heavy for such individuals

to bear. Sometimes victims opt for the sale of any assets that they purchased while in

employment to handle the financial crisis in their lives. However, if they are married, the income

status of the spouse and the history of shared responsibilities becomes a crucial pillar for

financial sustenance (Kramer & Amit 1320). Additionally, having caring members of the

extended family may also help victims handle the misfortunes of loss of employment.

Health Effects

Individuals who suffer a job loss, therefore, find themselves stressed by family pressures.

They lose their identity in society, thereby losing self-esteem. Financial challenges, thus, lead to

psychological disturbances (Cygan‐Rehm et al. 1852). Individuals in such situations feel isolated

and neglected by their loved ones. They may resort to unplanned leisure with any bit of finances

they come across. Leisure activities such as excessive alcohol consumption and engaging in
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other hard drugs become a way they struggle to find peace of mind. Therefore the victims of job

loss are left with the uncertainty of the future in the labour market, ending up depressed.

The uncertainty and depression surrounding their lives cause unhealthy habits like

alcohol and drug abuse that have been known to cause early death. Such individuals may die of

alcohol and drug abuse-related diseases like cancer, kidney and heart disorders. In extreme cases,

psychological disorders may lead them to commit suicide (Cygan‐Rehm et al. 1852). However,

apart from providing financial support, socializing with the family and society also reduces the

stress and depression that could have emanated from isolation and neglect from society.

Effects of Unemployment on Society

The effects of unemployment extend to the rest of the society and the community. There

is increased dependency in society. In extreme situations, individuals who lose employment

resort to criminal activities like theft and robbery for financial survival (Nordin & Daniel 11). If

this happens, members of society live in fear and danger of losing their lives and property due to

increased insecurity. Furthermore, the morals of youngsters who grow up in such a society are

compromised because they grow into a world of crime and insecurity.

Unemployment causes loss of essential skills from the labour market, which ruins the

economy of the society (Caggiano et al. 33). Individuals who suffer job losses tend to lose

interest in practising the skills, and therefore, chances of securing another job are minimal.

Furthermore, organizations lay off workers to balance their operational budgets, and they are less

likely to offer a salary increment to the few employees who remain, thereby demoralizing the

employees. Consequently, the remaining workers are overworked without compensation. Such

situations also cause psychological and social problems in the lives of employees.
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Conclusion

Conclusively, unemployment is harmful to the individual's socio-economic welfare. It

also affects the physical and psychological health of the victim. In addition, unemployment

affects those who live next to individuals who suffer a job loss since they are deprived of their

essential needs. Furthermore, unemployment extends to the immediate society in terms of

increased dependency ratio, high level of insecurity and crime and loss of skilled labour due to

redundancy. Therefore, eventually, the entire economy of a nation is adversely affected by high

rates of unemployment.

Works Cited

Caggiano, Giovanni, Efrem Castelnuovo, and Juan Manuel Figueres. "Economic policy

uncertainty and unemployment in the United States: A nonlinear approach." Economics

Letters 151 (2017): 31-34. https://doi.org/10.1016/j.econlet.2016.12.002

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Cygan‐Rehm, Kamila, Daniel Kuehnle, and Michael Oberfichtner. "Bounding the causal effect

of unemployment on mental health: Nonparametric evidence from four countries."

Health Economics 26.12 (2017): 1844-

1861.https://onlinelibrary.wiley.com/doi/full/10.1002/hec.3510

Kramer, Karen Z., and Amit Kramer. "At‐home father families in the United States: Gender

ideology, human capital, and unemployment." Journal of Marriage and Family 78.5

(2016): 1315-1331.https://doi.org/10.1111/jomf.12327

Monsef, Abdalali, and Abolfazl Shahmohammadi Mehrjardi. "The Effect of Unemployment on

Health Capital." Iranian Economic Review 22.4 (2018): 1016-

1033.https://dx.doi.org/10.22059/ier.2018.67853

Nordin, Martin, and Daniel Almén. "Long-term unemployment and violent crime." Empirical

Economics 52.1 (2017): 1-29. https://doi.org/10.1007/s00181-016-1068-6