Unemployment and job creation have become the biggest problem of the decade and this will rule the coming decades too. The growth of entrepreneurship has taken a set back as availability of resources in the developed economies has become limited as stiff competitions from the developing economies are fiercely high. Currently every year if we look into the history over the last 5 years we have getting threat of economic turmoil, economic and financial market collapse and hide and seek game of unemployment numbers. This time also we have series of concerns and currently the Euro zone is prime focus. Threat have become more naked now as whenever there is some economic exit from not able to bear the burden of pain ,one gets a threat that massive outflow and redemption of assets will happen. My point is how long and how much generation will bear the pain of toxic games of financial play. Why I am saying generation is that numbers are compelling enough to make us think differently.
Since the onset of the financial crisis in 2008, the crisis-related global jobs gap reached up to 61 million jobs in 2014 (ILO, 2015), a figure that is expected to grow to 82 million by 2019. And currently, long-term unemployment in Europe affects about 11 million people (EC, 2016), two thirds of whom have been unemployed for at least two consecutive years. Unemployment is running at more than 24% unemployment in Greece. It is above 20% in Spain, and in France and Italy it is well above 10%, and has been stuck at those levels for many years. Well these numbers are fake. Don’t be shocked but the truth is that the statistical data collectors collect only the data of those who are seeking for job. Obviously they don’t go and knock each home to find how is looking for job and who has left all hopes. Those who have filled for job have filled application and the above data reflects only that number.
Further the slowdown of the economy and rising cost and even maintain the basic amenities has resulted multiple people from same family looking for job. Those who have significantly affected due to financial collapse at different times over the last 5 years have become more vigilant to look for job and multiple members of the same family are looking for the same as compared to one earning member. This numbers will grow in the long term as more members form the same family will look for job. Hence more unemployment to increase.2nd ly the type of history we have created of economic crisis will result many next generation to flight for early job before they get a stable educational background. This behavioral culture cannot be changed in the immediate times. Just imagine that when the jobless rate for the under-25s is above 50%, in Spain is it more than 45% and in Italy and France it is above 24% how can you expect the next generation not to be scared for getting an early job.
Further employment pays are also of bigger concern. Now let’s come the entrepreneurship which is being envisaged as the next opportunity for the revival of the economy. Now in a technology driven economy how much employment could be generated through entrepreneurship since cost savings and low cost operation is the oxygen in the air of global economy. So those who are giving the theory of entrepreneurship will create multiple jobs is a fools theory. It will create jobs but will not improvise consumption as pays are low neither it will eliminate unemployment as all of them cannot get employed. The fear of economic collapse is becoming more strong and the biggest fear is that global economy is using threat mechanism to buy out toxic assets and at the same time creating toxic assets.
Indraneel Sen Gupta
Global Macro Economic Researcher and Business Strategist
Master of Economics, MBA in International Management, ICWAI (Final)