Causes and Effects of Unemployment

Mohammad Salem Hamidi, Assistant professor at Jahan University

And Dr. Baldev Singh

Email of Author [email protected]

Abstract
This study employs qualitative and quantitative research methods to investigate the causes and
effects of unemployment. Majority of which has been found that low level of education, the
collapse of local industries, inadequate job creation and neglect of the agricultural sector by the
State Government are largely responsible for unemployment in the local government area. The
study also found that low standard of living and high crime rates are the direct results of
unemployment and recommended the diversification of the economy to enhance the generation
of full and part time job opportunities, including the revitalization of collapsed local industries to
absorb the growing number of unemployment. Moreover, Among the working-age population,
one of the most damaging individual experiences is unemployment Many previous studies have
confirmed the devastating effects of unemployment on individual well-being, both pecuniary and
non-pecuniary. Unemployment substantially reduces an individual’s satisfaction levels with his
or her main vocational activity and finance, while it greatly increases his or her satisfaction
levels with leisure time. Finally, among the unemployed, non-pecuniary factors such as job
prospects, health and social relations – show significant effects on individual well-being, along
with household income.

Keywords: Unemployment, Crime, Education Lack, Satisfaction, Health, Life Problems and
much more.
1. Introduction

Developing countries are gradually gaining prominence in the world economy as emerging
market share and responsibility within the global economy increases. US Survey (2017) notes
that unemployment is a challenging policy arena for developing countries, yet little empirical
evidence is available to inform policy planning and development. Consequently, an unemployed
person, according to European Union (2019), can be defined as someone without any physical
means of livelihood but is actively seeking work. Unarguably, unemployment is a major issue in
developing countries, including Afghanistan where it affects young men and women with a
potential for crime and social unrest. The recent social unrest and political uprising in the Middle
East underscored the perils of high rates of unemployment, especially among the youths.
European Union (2019) again states that, aside from terrorism, youth unemployment is one of the
greatest threats to national security mainly because idle hands are the devil’s workshop. In
Afghanistan, for example, some of the effects of youth unemployment are seen in political
unrest, economic instability, drug abuse, crime, prostitution, human trafficking, terrorism and
kidnapping European Union (2019). Similarly, US Survey (2017) asserts that, there are
suggestions in the media and public discussions that unemployment might have played a role in
the eruption of social conflict as the countries experience significant above average levels of
unemployment as compared to other developed and industrialized countries. Corroborating these
facts, the World Bank (2014) contends that youth unemployment is high in all regions of the
world, much higher than adult unemployment. The World Bank further shows that, in 2010, the
world average for youth unemployment was 12.6 per cent, roughly 2.5 times higher than that of
adults. Empirical evidence suggests that youth unemployment is much higher in Afghanistan.
Interestingly, Yet the country’s current unemployment rate, according to the National Bureau of
Statistics of Afghanistan (2016), is over 65 per cent. In other words, over 35 million of the
country’s population of about 19.4 million is unemployed. For example, many graduate job
seekers lost their lives recently in Afghanistan. According to European Union (2019), over
900,000 people applied for the 4,500 job openings in Afghanistan. This shows that
unemployment in Afghanistan has reached a crisis point. Unemployment assumed a greater
dimension following the emergence of crude oil in Afghanistan. By 1986, an estimated 12.7
million people were said to be unemployed with about 4.5 million youths joining the labor force
annually. All the components of the labor force suffered from the scourge of unemployment of
youths, especially graduates, retrenched civil servants and private sector employees. According
to CIGAR (2020), unemployment is touching the peak but the available reports from various
local and international bodies and the glaring evidence of joblessness in these decades are clear
indications that there is no time in Afghanistan checkered history where unemployment is as
serious as now.

2. Literature Review

2.1 Youth Unemployment:

The concept of unemployment, like others in the

fields of human Endeavour, has received various
definitions and descriptions. This is because human
beings view things from different perspectives. For
example, the International Labor Organization
(ILO, 2007) defines unemployed persons as those
who are currently not working but are willing and
able to work for pay and have actively searched for work. The Afghanistan National Youth
Policy (2010) also refers to unemployment as the facts of a number of people not having a job
and youth unemployment as the unemployment of young people between the ages of 18-40years.
In the same vein, an operational definition of youth unemployment for this study will include
underemployment, hence youth unemployment occurs when young people who are able and
willing to work are without jobs or cannot find work. It also occurs when young people
undertake jobs that are contrary or lower than their academic qualifications or areas of
specialization.

2.2

The literature discusses unemployment as being

caused by many things. Fig 2 shows the dimensions of
the unemployment problem
Regarding the educational dimension, one of the causes of unemployment is the field of study [2]
[2]. The student should know what the careers of their field of study are and what the market
needs in relation to their study. Without doing that, this will lead to market saturation in some
fields and a lack of skilled labor in others. For example, the study of [2], in Afghanistan, found
that specific majors of graduated students were affected the time to find employment, and
therefore, may cause unemployment problems. Consequently, it demonstrates that graduated
students in the areas of human resources, industrial psychology, labor relations management,
public administration, public management, and politics must wait a long time before finding a
job after graduation. In particular, the wait time is about 21 months for graduated students in the
fields of public management, public administration, and politics, compared to only 10.5 months
in human resources, industrial psychology, and labor relations. On the other hand, graduated
students in the fields of accounting, math, education, and health have the shortest average wait
periods. Apart from the field of study, job skills mismatch is also mainly related to
unemployment problem based the educational dimension. While an increasing number of
universities have greater enrolment than in past decades, less attention is paid to their output
quality in terms of balancing acquired skills with demanded skills. This has led to increasing the
unemployment rate of graduated students, especially since the recession, as only a few
graduated.

Moreover, gender is another cause of unemployment. It contributes to 39.5% of unemployment

in educated females, compared to only 25.8% of educated males in Afghanistan. Unemployment
among Male is also higher in urban. In addition, the study of 29 pointed out that single people
are more unemployed than married, because married people often accept lower wages to do their
liabilities after marriage. Furthermore, demographic youth bulges and housing discrimination
have played roles in unemployment, especially among blacks in the central cities. Additionally, a
lack of confidence and poor English communication skills are considered other factors that lead
to unemployment, especially in countries that do not use English as a native language.

3. Objectives
The main objective of this research paper is the study of the finding on equitable solutions to the
causes and effects of unemployment on people Youth & Adult. The paper will be handled in
terms of specific objectives as follows.

 Discuss the causes and effects unemployment on people.

 Discuss the effects of unemployment, the direct and indirect practices the people have.
 Discuss solutions to unemployment for people.

4. Research Questions

 1. What are the problems encountered as a result of being unemployed?

 2. Does unemployment lead to health problems?

5. Scope

The scope of this project work focuses on the causes and effects of unemployment

6. Research Methodology

Sampling, which is an important aspect of data collection, is a statistical practice concerned with
the selection of subset of individual observation from a given universe with the view of drawing
conclusions. In this study a sample of 75 respondents were interviewed. Sources of Data
Collection Primary Sources Primary data was collected by administering structured and relevant
questionnaire to the sample population. Secondary sources Secondary was studied from relevant
information available at the company in the form of past records, company website and booklets,
newspapers, articles and journals.

Tools and Techniques for data Collection:

The information was obtained through observation, administering of the structured questionnaire
and interviews with the selected sample population. Data available in various reports, articles,
books, periodicals was also be used.

7. Data Analysis and Discussions

Plan of Analysis:

The data collected was analyzed and interpreted using various statistical tools. It was tabulated
against the number of respondents and percentages favoring them. Bar and pie charts were used
to present, and interpretation was deduced. Wrong inferences like incomplete and dishonest
answers was eliminated.
8. Conclusion

Unemployment is a serious issue for any economy. It creates negative affects to unemployed as
they are jobless and suffer from worse prospects to find new job and those who are employed
feel less secure to keep their jobs in future. However, for overall development of economy,
government and individuals has to take initiative steps in increasing the productivity and
improving the standard of living. Moreover, now a days, obviously our rate of unemployment
here in our country is very high. The main reason why continuously of increasing unemployment
is because of poverty. And also, one reason of increasing unemployment , graduate students that
the course they taken from college is not compatible for the job offer, that`s why it is hard for
them to find a job and it can cause of increasing unemployment.
Unemployment is caused by many factors in a modern market economy. It can be caused by
rapid technological change, business cycle of recessions, seasonal factors in some industries
particularly such as changes in tastes and climatic condition which affects demand for certain
products and services, individual perceptions and willingness to work and search for job, their
values and attitudes towards some jobs and about unemployed of the benefits of training and the
possibility for them to get a job after the training even though they have a chance to get a job,
discrimination in the work place based on a race, color, religion, ethnicity, age and class
sensitive agricultural products. More open economy, allowing for more free trade and free
market forces.
Reference