Unemployment - History - 20th Century

20th Century

Unemployed men, marching for jobs during the Great Depression in Canada, 1930

There were labor shortages during WW I. Ford Motor Co. doubled wages to reduce turnover. After 1925 unemployment began to gradually rise.

The decade of the 1930s saw the Great Depression impact unemployment across the globe. One Soviet trading corporation in New York averaged 350 applications a day from Americans seeking jobs in the Soviet Union. In Germany the unemployment rate reached nearly 25% in 1932.

In some towns and cities in the north east of England, unemployment reached as high as 70%; the national unemployment level peaked at more than 22% in 1932. Unemployment in Canada reached 27% at the depth of the Depression in 1933. In 1929, the U.S. unemployment rate averaged 3%. In 1933, 25% of all American workers and 37% of all nonfarm workers were unemployed.

In Cleveland, Ohio, the unemployment rate was 60%; in Toledo, Ohio, 80%. There were two million homeless people migrating across the United States. Over 3 million unemployed young men were taken out of the cities and placed into 2600+ work camps managed by the CCC.

Unemployment in the United Kingdom fell later in the 1930s as the depression eased, and remained low (in six figures) after World War II.

Fredrick Mills found that in the U.S., 51% of the decline in work hours was due to the fall in production and 49% was from increased productivity. By 1972 unemployment in the UK had crept back up above 1,000,000, and was even higher by the end of the decade, with inflation also being high. Although the monetarist economic policies of Margaret Thatcher's Conservative government saw inflation reduced after 1979, unemployment soared in the early 1980s, exceeding 3,000,000 — a level not seen for some 50 years — by 1982. This represented one in eight of the workforce, with unemployment exceeding 20% in some parts of the United Kingdom which had relied on the now-declining industries such as coal mining.

However, this was a time of high unemployment in all major industrialised nations. By the spring of 1983, unemployment in the United Kingdom had risen by 6% in the previous 12 months; compared to 10% in Japan, 23% in the United States of America and 34% in West Germany (seven years before reunification).

Unemployment in the United Kingdom remained above 3,000,000 until the spring of 1987, by which time the economy was enjoying a boom. By the end of 1989, unemployment had fallen to 1,600,000. However, inflation had reached 7.8% and the following year it reached a nine-year high of 9.5%; leading to increased interest rates.

Another recession began during 1990 and lasted until 1992. Unemployment began to increase and by the end of 1992 nearly 3,000,000 in the United Kingdom were unemployed. Then came a strong economic recovery. With inflation down to 1.6% by 1993, unemployment then began to fall rapidly, standing at 1,800,000 by early 1997.

The official unemployment rate in the 16 EU countries that use the euro rose to 10% in December 2009 as a result of another recession. Latvia had the highest unemployment rate in EU at 22.3% for November 2009. Europe's young workers have been especially hard hit. In November 2009, the unemployment rate in the EU27 for those aged 15–24 was 18.3%. For those under 25, the unemployment rate in Spain was 43.8%. Unemployment has risen in two-thirds of European countries since 2010.

Into the 21st century, unemployment in the United Kingdom remained low and the economy remaining strong, while at this time several other European economies — namely, France and Germany (reunified a decade earlier) — experienced a minor recession and a substantial rise in unemployment.

In 2008, when the recession brought on another increase in the United Kingdom, after 15 years of economic growth and no major rises in unemployment. Early in 2009, unemployment passed the 2,000,000 mark, by which time economists were predicting it would soon reach 3,000,000. However, the end of the recession was declared in January 2010 and unemployment peaked at nearly 2,700,000 in 2011, appearing to ease fears of unemployment reaching 3,000,000. The unemployment rate of Britain's young black people was 47.4% in 2011.

A flood of inexpensive consumer goods from China has recently encountered criticism from Europe, the United States and some African countries. As of 26 April 2005 Asia Times article notes that, "In regional giant South Africa, some 300,000 textile workers have lost their jobs in the past two years due to the influx of Chinese goods". The increasing U.S. trade deficit with China has cost 2.4 million American jobs between 2001 and 2008, according to a study by the Economic Policy Institute (EPI). From 2000 to 2007, the United States had lost a total of 3.2 million manufacturing jobs.

About 25 million people in the world's 30 richest countries will have lost their jobs between the end of 2007 and the end of 2010 as the economic downturn pushes most countries into recession. In April 2010, the U.S. unemployment rate was 9.9%, but the government's broader U-6 unemployment rate was 17.1%. There are six unemployed people, on average, for each available job. In April 2012, the unemployment rate was 4.6% in Japan. In a 2012 news story, the Financial Post reported, "Nearly 75 million youth are unemployed around the world, an increase of more than 4 million since 2007. In the European Union, where a debt crisis followed the financial crisis, the youth unemployment rate rose to 18% last year from 12.5% in 2007, the ILO report shows."

Read more about this topic:  Unemployment, History

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