Unemployment rate of 42.1% is very, very high

Labour minister Joyce Simukoko says the 2017 Labour Force Survey shows that unemployment rate was at 41.2 per cent.

“52 per cent of the labour force is in urban areas whereas 48 per cent is in rural areas. The estimated labour force was 5,049,059 persons, of these 2,289,961 were females and 2,759,098 were males. The labour force survey further shows that the unemployment rate was at 41.2 per cent. The rate was higher among females at 48.8 per cent than among males at 34.8 per cent. Rural – urban analysis shows that urban areas had a higher unemployment rate at 50.8 per cent compared to 32.2 in rural areas,” says Simukoko.

This is frightening very, very high high levels of unemployment.
Unemployment is the situation of actively looking for employment but not being currently employed. The unemployment rate is a measure of the prevalence of joblessness and it is calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labour force.
On an individual level, unemployment reduces the level of income that an individual earns. As their income has been reduced, consumption also reduces as they pay for necessities rather than luxuries. Goods that are income elastic will be consumed less. Quality of life will be reduced for the unemployed worker. Workers may become discouraged and give up searching for jobs, becoming part of the long term structural unemployment in Zambia. Unemployment can have significance effects on the performance of the economy as a whole.
The effects are most marked due to long term unemployment. If there is unemployment in the economy, resources are not being used effectively and the economy will be operating below any points on the production-possibility frontier (PPF) curve. A PPF is a curve which shows various combinations of set of two goods which can be produced with the given resources and technology where the given resources are fully and efficiently utilised per unit time. One good can only be produced by diverting resources from other goods, and so by producing less of them. This tradeoff is usually considered for an economy, but also applies to each individual, household, and economic organisation.

If unemployment rates are rising, there will be a negative impact on economic growth potential. Consumption is likely to fall as consumers will have had a decrease in income levels. Taxation levels will decrease as less people are in work and therefore paying taxes. Persistently high unemployment creates huge costs for individuals and for the economy as a whole. Some of these costs are difficult to value and measure, especially the longer-term social costs. Unemployment is costly. Workers who face a prolonged period of unemployment are more likely to lose some of their job skills and may find it harder to get jobs as more and more time passes.

Of all the aspects of social misery, nothing is as heartbreaking as unemployment. Specific individual consequences of unemployment are obvious. How do you buy food? Pay the rent? Buying even the basic necessities could be tough, much less buying the latest technology gadget. These consequences are real for the unemployed, and the accumulative effects are visible in the entire economy as individuals and businesses struggle to meet the challenges that unemployment creates.

Unemployment also has less obvious costs and consequences. During periods of high unemployment, people may be forced to take practically any job they can get. College graduates entering the job market during economic downturns may be forced to accept lower-paying, less-attractive jobs below their skill levels. Although this is better than being unemployed, lower wages and slower career advancement can persist for years.

Even 10, 15 or 20 years later, wages and career advancement of college graduates who enter the labour market during economic downturns remain lower than those of workers who enter when the economy is strong. Social consequences of prolonged unemployment can be significant. A high unemployment rate is said to be directly linked to increases in property-related crime. Unemployment can also affect the health of individuals and families. People with a high risk of unemployment decreased their consumption of good food. Such a diet change can affect workers as well as their children’s health in the long run. Inadequate nutrition of children, a particular risk in low-income families, can hinder their physical and mental development.

Leave a Reply

Your email address will not be published. Required fields are marked *