Another important government economic objective is to keep low unemployment in the country. In this way, the government can maintain and improve the country’s economic status.
What is unemployment?
The unemployment rate tells us the proportion of people in a country’s workforce, both willing and able to work, but who cannot find jobs.
The Unemployment Rate (%) = Unemployed people ÷ Total workforce x 100
The natural healthy rate of unemployment in a country is between 3.5% and 4.5%.
The differences in unemployment rates in the world vary dramatically between countries.
Countries with high unemployment
Many citizens in the country with high unemployment do not have jobs.
There will be poverty, serious unhappiness and anxiety among the citizens, relatively low spending power, many negative social issues such as increased crime, unhealthiness and high addiction levels, high government spending on unemployment benefits so less government spending on public goods, additional burdens on TAX payers.
The government’s revenue from both Individual Income TAX and Corporate TAX will be low. Sales revenue for businesses and demand for suppliers will also be low.
According to Investopedia. com, The world’s top four countries with the highest unemployment rates at the end of 2020 include:
- South Africa: 28.5%
- Occupied Palestinian Territories: 26.1%
- Lesotho: 22.8%
- Eswatini / Swaziland: 22%
A country with high unemployment (usually above 10%) will suffer from overall low competitiveness against other countries.
Countries with low unemployment
Most of the citizens in the country with low unemployment have jobs.
There will be no poverty, the citizens will be fairly happy and content, relatively high spending power, not many negative social issues meaning low crime rates, proper healthiness and low addiction levels, low government spending on unemployment benefits so more government spending on public goods, no additional burdens on TAX payers.
The government’s revenue from both Individual Income TAX and Corporate TAX will be high. Sales revenue for businesses and demand for suppliers will also be high.
According to Investopedia.com, the world’s top four countries with the lowest unemployment rates at the end of 2020 include:
- Qatar: 0.1%
- Solomon Islands: 0.5%
- Niger: 0.5%
- Lao / Laos: 0.6%
A country with low unemployment (usually below 2-3%) will benefit from overall high competitiveness against other countries.
