Unemployment Dynamics: Economic & Social Impacts

Understanding Unemployment

Historical Roots & Economic Costs

Unemployment is a phenomenon of the industrial economy, emerging over the past two centuries. In the past, land was an important source of employment. Nowadays, unemployment incurs significant economic costs due to production loss, and substantial social costs because of its negative effects on income distribution.

Factors Shaping the Job Market

Laws, social institutions, and personal assessments are among the many factors that influence the job market.

Spain's Labor Market: 1980-2011 Trends

Pre-Crisis Growth & Post-Crisis Plunge

According to García Brossa, the evolution of the Spanish job market from 1980 to 2011 has been characterized by several key developments. There was an increase in the labor force due to immigration and the incorporation of women into the job market. With tourism and construction soaring, employment was rapidly created until 2007. However, the crisis erupted, and as a consequence, jobs plummeted. In fact, Spain ranks second highest in unemployment among EU countries.

Economic growth until 2007 allowed for a reduction in unemployment figures, but the subsequent economic crisis led to a significant increase in joblessness.

Profile of the Unemployed Population

Demographic Disparities in Joblessness

The characteristics of the unemployed population include:

• A higher youth unemployment rate than the European average.
• A greater incidence among women.
• A higher unemployment rate among immigrants.
• A lower unemployment rate among university graduates.
• Significant regional disparities.

The Broad Impact of Unemployment

Economic, Social, and Psychological Effects

According to Moa, the consequences of unemployment are multifaceted and affect the entire population. First, family incomes decrease, and both labor exploitation and the informal economy tend to increase. Secondly, criminality rises, and there is a reduced interest in pursuing education. Consumption is also reduced, and young people find it difficult to achieve independence and self-sufficiency or to start families.

Depression, anxiety, and low self-esteem are some of the psychological consequences that unemployment can have.

Key Economic Policy Objectives

Strategies for Job Creation & Support

The fundamental aims of economic policies should be to create employment, ease young people's access to the labor market, improve training opportunities for the unemployed, and reduce temporary contracts. Nothing is possible without jobs.