Course: Social Problems of Pakistan (SOC-415)
Course Instructor: Saeed Mashaal Bhatti
saeed.mashaal@uog.edu.pk
Unemployment refers to the
total number of people who do not have jobs in a particular place or area.
Unemployment occurs when people are without work and actively seeking work. Socialism
refers to an economic system characterized by state ownership of the means of
production and distribution of goods and services. Capitalism is an
economic system characterized by private ownership of the means of production
and distribution of goods and services for profit in a competitive market. Industrialization
is the replacement of hand tools, human labor, and animal labor with machines
run by steam, gasoline, and electric power. Post-industrialization
refers to the shift from an industrial economy dominated by manufacturing jobs
to an economy dominated by service-oriented, information-intensive occupations.
CLASSIFICATIONS
OF UNEMPLOYMENT
1.
Structural unemployment focuses on the
structural problems within an economy and inefficiencies in labor markets.
2.
Frictional unemployment is the time
period between jobs when a worker is searching for or transitioning from one
job to another.
3.
Cyclical unemployment is a type of
unemployment that occurs when there is not enough aggregate demand in the
economy to provide jobs for everyone who wants to work.
4.
Classical unemployment occurs when real
wages for jobs are set above the marketing clearing level.
5.
The
natural
unemployment rate represents the hypothetical unemployment rate
that is consistent with aggregate production being at a long-run level.
HOW
TO SOCIAL PROBLEM
When large numbers of people are
unemployed, it has widespread economic and social effects. Hunger and
homelessness are considered social problems. If you can't feed your family, or
pay your rent, you need help. Social service agencies are set up to provide
help and relief for people in these situations; unemployment is therefore a
social problem.
CHARACTERISTICS
OF UNEMPLOYMENT
Unemployment is bad. Obviously long-term
unemployment is worse. But it's not just a little worse, it's horrifically
worse.
1.
Its
way higher than it's ever been before. When the headline unemployment rate
peaked in 2010, it was actually a bit lower than the peak during the 1980
recession and only a point higher than the 1973 recession. As bad as it was, it
was something we'd faced before. But the long-term unemployment rate is a whole
different story. It peaked at a rate nearly double the worst we'd ever seen in
the past, and it's been coming down only slowly ever since.
2.
It’s
widespread. There's a common belief that long-term unemployment mostly affects
older workers and only in certain industries. In fact, with the exception of
the construction industry, which was hurt especially badly during the 2007-08
recession, "the long-term unemployed are fairly evenly distributed across
the age and industry spectrum."
3.
Obviously
long-term unemployment produces a sharp loss of income, with all the stress
that entails. But it does more. It produces deep distress, worse mental and
physical health, higher mortality rates, hampers children’s educational
progress, and lowers their future earnings.
4.
It's
long-lasting. "job loss has consequences that linger even after people
return to work. Finding a job, on average, recovers only about two thirds of
the initial harm of losing a job.
5.
It
dramatically reduces the prospect of getting another job. recent research suggests that this attitude
has become even worse in the current weak economy. Rand Grayed, a visiting
scholar at the Boston Fed, sent out a bunch of fictitious resumes for 600 job
openings. Each batch of resumes was slightly different (industry experience,
job switching history, etc.), and all of these things had a small effect on the
chance of getting a callback. Effect: being unemployed for six months or more.
If you were one of the long-term unemployed, it was all but impossible to even
get considered for a job opening.
6.
It
turns cyclical unemployment into structural unemployment. What we've mostly had
during the Great Recession and the subsequent recovery has been cyclical
unemployment. This is unemployment caused by a simple lack of demand, and it
goes away when the economy picks up. But structural unemployment is worse: it's
caused by a mismatch between the skills employers want and the skills workers
have.
7.
It
hurts the economy. IMF research
conference, concludes that "by tolerating high unemployment we have
inflicted huge damage on our long-run prospects." How much? The authors
suggest that not only has it cut GDP growth, it's even cut potential GDP
growth. They estimate the damage at about 7 percent per year—which represents a
loss of roughly $3,000 for every man, woman, and child in the country.
CAUSES
OF UNEMPLOYMENT
1.
Growth of Population: One of the
major problems regarding unemployment in Pakistan is uncontrolled growth of
population. The population of Pakistan is increasing at very high rate this
time. According to the statistical, the population of Pakistan is increasing at
the rate of 2.2%. There are plenty of factors responsible for over population
such as early marriages, illiteracy, desires for sons, lack of awareness etc.
2.
Poor Education System: The education
system in Pakistan has been really poor since the creation of Pakistan.
Unfortunately any government since independence didn’t take especial steps to
make the education system batter. Education system in Pakistan is unbalanced.
It has been seen even talented students left study due to injustice of system.
You will observe many technical educational colleges and private technical
institutions are being found which are only selling degrees because technical education
which is being given in these institutions has no value, therefore people are
wondering about for jobs due to lack of experience and skills.
3.
Violence and Terror Activities: As we all know
very well that the Karachi is hub of trade and business in Pakistan but there
are no rules and regulations in Karachi as everyone is violating law in the
biggest city of Pakistan. The peace of Karachi has been destroyed. The hidden
internal and external elements do not want to see Karachi prosperous.
Furthermore, Pakistan having very bad time at the moment due to uncontrollable terrorism.
Another cause of unemployment is terrorism. Terrorist activities in Pakistan
are on peak at present especially in Karachi, therefore situation in Karachi is
really threatening and alarming and due to this the nationals and as well as
foreigners are frightened to invest in Pakistan.
4.
Energy Crisis: There are many
sources of producing of energy in Pakistan but due to lack of proper planning
and efforts Pakistan is having problem of energy crisis. The government of
Pakistan is unable to provide electricity to residential areas in Pakistan than
how can energy or electricity can be provided to factories and industries.
Therefore factories and industries that are required energy are transferring
their business in other Asian countries like Bangladesh, India and as well as
Sri Lanka. As of this result a huge number of labors are becoming the victims
of unemployment.
5.
High Age of Retirement: The age of
retirement in Pakistan is 60 years and it is really high age of retirement and
the government of Pakistan is directly responsible for this factor. There are
various educated people are in wait of jobs but high age of retirement is
making young ones frustrated.
6.
Afghans Refugees: Afghans
refugee to Pakistan is the additional problem of unemployment in Pakistan. When American army attacked on Afghanistan in
2001 about 13 years ago and due to this plenty of Afghans migrated to Pakistan
for making them save till the betterment situation of their country but the
situation in Afghanistan is still critical. The migrated people caused labor
markets as they are ready to work for fewer wages.
CONSEQUENCES
OF UNEMPLOYMENT
Effects
of unemployment on economy
1.
Unemployment financial costs: The government
and the nation suffer. In many countries the government has to pay the
unemployed some benefits. The greater the number of the unemployed or the
longer they are without work the more money the government has to shell out. Therefore,
the nation not only has to deal with the lost income and decreased production
but also with additional cost.
2.
Spending power: The spending
power of an unemployed person and his/her family decreases drastically and they
would rather save than spend their money, which in turn affects the economy
adversely.
3.
Reduced spending power of the employed: Increased
taxes and the insecurity about their own work may affect the spending power of
the working people as well and they too may start to spend less than before
thus affecting the economy and also the society in a negative manner.
4.
Recession: With the increase rates of
unemployment other economy factors are significantly affected, such as: the
income per person, health costs, quality of health-care, standard of leaving
and poverty.
The
effect of unemployment on society
Unemployment
affects not just the person himself but also his/her family and in the long run
the society where he lives. Unemployment brings with it despair, unhappiness
and anguish. It forces people to live their lives in a way they do not wish to
– The life expectancy is negatively affected. Life expectancy is the ease by
which people living in a time/place are able to satisfy their needs/wants. Here
are the main aspects:
1.
Mental health problems like: Law
self-confidence, feeling unworthy, depression and hopelessness. With the lost
income and the frustration involved in it, the recently unemployed may develop
negative attitudes toward common things in life and may feel that all sense of
purpose is lost. Frequent emotions could be – low self-esteem, inadequateness
and feeling dejected and hopeless.
2.
Health diseases: The
unemployment overall tension can increase dramatically general health issues of
individuals.
3.
Domestic and political issues: Quarrels and
arguments at home front which may lead to tension and increased numbers of
divorces etc. Loss of trust in administration and the government which may lead
to political instability
4.
Tension over taxes rise: Unemployment
also brings up discontent and frustration amongst the tax paying citizens. In
order to meet the demands of the unemployment fund the government many a times
may have to increase the taxes thus giving way to restlessness amongst the tax
paying citizens.
5.
Insecurity amongst employees: The prevailing
unemployment and the plight of the unemployed people and their families may
create fear and insecurity even in the currently employed people.
6.
Crime and violence: Increase in
the rate of crime.
7.
Stigma: Unemployment brings with more
than just ‘no work’. It also brings with it the disgrace that the person has to
bear. Nobody likes to be termed as unemployed.
8.
Standard of leaving: In times of
unemployment the competition for jobs and the negotiation power of the
individual decreases and thus also the living standard of people with the
salaries packages and income reduced.
9.
Employment gaps: To further
complicate the situation the longer the individual is out of job the more
difficult it becomes to find one. Employers find employment gasps as a negative
aspect. No one wants to hire a person who has been out of work for some time
even when there’s no fault of the individual per say.
10. Lose of skills’
usage:
The unemployed is not able to put his/her skills to use. And in a situation
where it goes on for too long the person may have to lose some of his/her
skills.
SOLUTION
OF UNEMPLOYMENT IN PAKISTAN
It will be tough ask for government to
solve one of the major problems of Pakistan “Unemployment” due to huge
population but still we have given some solutions to reduce the unemployment in
Pakistan and we are hopeful by following these solutions the ratio of
unemployment in Pakistan can be reduced or decreased.
1.
Planning and management: The first
thing to do to reduce unemployment in Pakistan is the proper planning by the government
of Pakistan.
2.
Improving education system: The education
system of Pakistan should be equal and well managed.
3.
Skills and training: Well
recognized training and technical institutions are need to be established where
skills programs are offered.
4.
Stabilizing Energy crisis: Remove energy
crisis so that investor comes to Pakistan thus job placement will automatically
be created.
5.
Law and order situation: There should
be peace across the country so foreigners will not hesitate to invest in
Pakistan.
6.
Grooming agricultural sector: The
agriculture sector should be developed.
7.
Meritocracy in the employment: Jobs should be
given purely on merits.
8.
Attracting foreign companies: Encourage
multinational companies to business in Pakistan.
9.
Family panning: Family planning
centers should be opened to control the flow of over population.