Government Policies to Reduce Unemployment
One in every three Americans believes that unemployment is the biggest problem the United States is currently facing. According to a recent survey conducted byGallup, a research organization that holds a reputation for delivering relevant and timely data, 35 percent of Americans see unemployment, not the economy as a whole, as the most important problem the country faces.
TheBureau of Labor and Statisticsreports industry-based unemployment rates as high as 10-16 percent in several industries.
Last month, the manufacturing industry recorded the highest industry-based unemployment rate at 16.8 percent – that is already after a slight improvement a year ago when the unemployment rate in the same industry is at an alarming 20.1 percent.
Needless to say, the government is constantly working to reduce the overall unemployment figure. In 2008, during the height of the Great Recession, the Obama administration launched a stimulus package that provided additional jobs for Americans.
While the U.S. stimulus package might have backfired and resulted in more bad than good, there are still a lot ofstrategies the government can use to reduce unemployment rate.
Some economists suggest providing additional benefits and incentives to entice unemployed workers to look for a job. Improving the education system is also a direct way to reduce unemployment especially for contractual and seasonal workers.
Improving and diversifying the skills of contractual and seasonal workers allows them to attract bigger and better job opportunities. For instance, a contractual worker who is educated in several diverse disciplines will have an easier time to look for a job once his contract expires. Hence, education is critical in today’s competitive job market.
Workers should also be given direct access and better information on job vacancies. Another effective unemployment reduction strategy is to provide subsidies to businesses that will hire additional workers. In addition, businesses that will hire workers with disabilities should also be given subsidies. Subsidies can take the form of conditional cash transfer programs or even tax exemptions.
The government should also encourage workers to move into areas where there are more employment opportunities. An effective way to do that is by providing low-cost housing programs in urban areas where job opportunities are greater.
While there are lots of unemployment reduction strategies the government can push for, a few economists believe that the best way to reduce unemployment is to not do anything. They argue that intervening with the job market slows the natural flow of the market and will just worsen the situation.
