[Help] How does unemployment efect government?

Reply from ajjevste

ajjevste — Tue, 08 Dec 2009 14:49:00 +0100

Thank you for posting this wolfsilverwolf it really helped us :)
Our names are Tevon and Jegan and we are from Sidmouth College, doing business studies. We have recently been studying inflation and unemployment and this article caught our eye, we agree with exactly what you said as we have been taught this from our recent studies. Your answer was very clear and we understood clearly the point you were trying to get across. We couldn’t have thought of a better answer!
Love Tevon and Jegan xxx 3

Reply from wolfsilverwolf

wolfsilverwolf — Sun, 16 Nov 2008 20:22:29 +0100

There are a few ways unemployment affects government. For example…

1.) More money is spent on welfare for unemployed people by the government.
2.) If unemployment rates are high, the government in charge is blamed for economic problems that resulted in this high rate.
3.) The more unemployed people there are, the less likely some luxury items (say, cars) will be bought, which may result in a government bailout if the luxury item companies in trouble are also a good source of a country’s revenue from tax dollars.