Unemployment: Curse Or Blessing In Disguise?
It seems that every other week the media gets a fresh round of bad news to share with us, related to the current recession and its impact on the unemployment rate (which climbed to more than 7%). This morning I was reading that since the start of the recession the number of unemployed people has grown by 3.6 million, and the unemployment rate has risen by 2.3 percentage points. While this is hardly good news, it should at the very least get us to think about the way our lives have been when it comes to how we earn a living.
What happens in tough times such as now, where everyone tightens their belts? Businesses make less money and are usually forced to reduce their workforce, sending waves of people into unemployment. But at the same time, they also take a good look at their business practices to see where they can save money and be more efficient. As a result, a leaner business is more productive and offers its production to its customers at a lower cost. And it so happens that in such an environment, customers are more attracted than ever to low prices.
Rising unemployment also breeds competition among employees, which is something that is rarely thought about when the concept of competition is mentioned. High unemployment rates makes people more aware that they have to perform to keep their jobs, and they tend to be more productive. If there have been layoffs, a reduced staff ends up doing the same amount of work; if there have been no layoffs, the same staff does more work. Finally, depending on the company, workers agree to pay freezes or even pay cuts to keep their jobs, which helps companies' bottom lines.
Given the constant coverage that is bestowed upon the current unemployment rate in the country, you might think that ours is higher that that of other countries of comparable economic stature. Not so! In several of the most developed European Union countries, the unemployment rate has been at or around 8% for many years. The United States probably has come to a point where as a country it must realize that the past ultra-low unemployment rate (known as full employment) was exceptional and move on to less glamorous statistics.
Finally, my main point is this one. The United States' current unemployment rate of 6.7 percent translates into 10.3 million people without a job. The state of Michigan is the hardest hit, with a double digit rate, because they depend heavily on the manufacturing business and the factories as their main source of employment. At the other end of the spectrum, Wyoming, with the lowest unemployment rate of only 3.2 percent because it's a farming state. Farmers are self-employed people who work hard as a family to make a living. In order to solve our current economic crisis, we probably should turn back to self employment.
That is not to say that we should all turn into farmers in order to solve the deepest financial crisis since the Great Depression. The idea is that we should stop relying on others to provide us with jobs. Wyoming's unemployment rate is the lowest of the country because it's hard to get fired when you're your own boss. If you can find something you're good at and can make money from, consider that the world is turning into one big village, and that the Internet allows you to do business anywhere in the world if you're so inclined. There have seldom been better times to consider being in business for yourself.
What happens in tough times such as now, where everyone tightens their belts? Businesses make less money and are usually forced to reduce their workforce, sending waves of people into unemployment. But at the same time, they also take a good look at their business practices to see where they can save money and be more efficient. As a result, a leaner business is more productive and offers its production to its customers at a lower cost. And it so happens that in such an environment, customers are more attracted than ever to low prices.
Rising unemployment also breeds competition among employees, which is something that is rarely thought about when the concept of competition is mentioned. High unemployment rates makes people more aware that they have to perform to keep their jobs, and they tend to be more productive. If there have been layoffs, a reduced staff ends up doing the same amount of work; if there have been no layoffs, the same staff does more work. Finally, depending on the company, workers agree to pay freezes or even pay cuts to keep their jobs, which helps companies' bottom lines.
Given the constant coverage that is bestowed upon the current unemployment rate in the country, you might think that ours is higher that that of other countries of comparable economic stature. Not so! In several of the most developed European Union countries, the unemployment rate has been at or around 8% for many years. The United States probably has come to a point where as a country it must realize that the past ultra-low unemployment rate (known as full employment) was exceptional and move on to less glamorous statistics.
Finally, my main point is this one. The United States' current unemployment rate of 6.7 percent translates into 10.3 million people without a job. The state of Michigan is the hardest hit, with a double digit rate, because they depend heavily on the manufacturing business and the factories as their main source of employment. At the other end of the spectrum, Wyoming, with the lowest unemployment rate of only 3.2 percent because it's a farming state. Farmers are self-employed people who work hard as a family to make a living. In order to solve our current economic crisis, we probably should turn back to self employment.
That is not to say that we should all turn into farmers in order to solve the deepest financial crisis since the Great Depression. The idea is that we should stop relying on others to provide us with jobs. Wyoming's unemployment rate is the lowest of the country because it's hard to get fired when you're your own boss. If you can find something you're good at and can make money from, consider that the world is turning into one big village, and that the Internet allows you to do business anywhere in the world if you're so inclined. There have seldom been better times to consider being in business for yourself.
About the Author:
Before embarking on your self-employment journey, make sure you read up on filing for unemployment insurance benefits benefits by visiting my financial blog.
Posts
Post a Comment