The Economic Growth and Unemployment Rate after the US Financial Crisis - Literature review Example

UNEMPLOYMENT RATE. Name: Course: Institution: Date: The Economic Growth and Unemployment Rate after the US Financial Crisis:A Review of David Leonhardt’s (2011) “A Mission Not Yet Accomplished” This article seeks to define the outcomes of the financial crisis witnessed in the US economy. The world’s largest economy hit a financial crisis in the year 2007. All other economies surprisingly tumbled down along it. This brought about adverse effects since companies collapsed, unemployment rates increased and consumers purchasing power decreased. The consumers’ firm trust deteriorated and the economic growth was viewed as grim. However, a couple of years later, the powerful US economy were gradually regaining its place. The road to recovery was full of positive promises in the housing prices. The firm trust in the economy was slowly been realised. The outputs and asset prices were adversely affected. The article focuses on the recovery process of one of the giant economies. Though the recovery processes seem to be at risk of stalling, all indications point to a steady pace. Functionalism as a vital perspective associated with sociology influence the consumer’s behaviour. There is a lot of reproach and caution to avert such an outcome as witnessed during the financial crisis. An article was published on the US economy. Unemployment Rate Kimberly Amadeo (2012), About.com Guide. The article discusses on the recent unemployment trends. The unemployment rate is basically the number of people who are in the labour force divided by those that are unemployed. According to this tabulation and that of the bureau of labour statistics, a person who does not have a job is not necessarily unemployed. The person has to have looked for employment for a couple of weeks to be declared unemployed. The article examines the various ways in which the unemployment rate has affected the economy of the country. How are the effects of seasonality affected? The economy’s growth rate can be gauged through the unemployment rates. The unemployment rate affects people since less people will be buying if many people are looking for work. Unemployment according to the outlook projected revealed that it would remain above 8%. Symbolic interactionism in sociology dictates that human beings normally act according to the meanings that they have assigned to certain objects in their environment. This unemployment rate will affect adjustments even when things start going stable. A newspaper article on (The telegraph). ‘Jobless rate hits 14-year high in two-speed euro zone.’The article examines the unemployment rates and trends as witnessed in the European countries. This is done using the European Union’s statistics which showed that there was a 10% increase in unemployment levels among the 17 countries. This was the highest rate since the euro was introduced in 1999. However, what brought about anxiety is the fact that it could increase with the coming months. This was according to economists who prophesied political unrests if measures were not put in place urgently. This is a bloc that produced approximately 16% of the global economic output. The leaders of these countries however shifted debate from managing the debt to bringing back growth. People’s behaviour is influenced by their definition of the situation at hand. The behaviourist approach dictates that human behaviour will elicit a stimulus and response ones faced with a challenge. This is exactly what elicited the action taken by the leaders of these countries. The euro zone leaders signed a budget pact that was to be adhered to by all countries. Unemployment Statistics - Unemployment Rate. Monthly Unemployment Rate Data. Alison Doyle (2012). The article reviews on the unemployment rate surveyed on a monthly basis. The rate was arrived at using sample surveys that were carried out by the bureau of labour statistics. This statistics are released on the first Friday of the month. The current population surveys measured the extent to which unemployment was happening and viewed its ramifications. As the functionalism theory states, the practices and institutions that arise as a result of a problem normally have decisive repercussions for the practices and repercussions that are meant to address other problems. Functional analysis will be manifested whereby there will be a relation between the social systems. A practice or institution will have major effects on other institutions. The bureau of labour statistics was crafted for the purposes of providing reliable data that would help in curtailing the unemployment witnessed during the financial crisis. This independent institutions finding will affect others in that it may recommend a slash in wages so as to accommodate more workers. The long recession in hiring. Matthew Yglesias on Sep 12, 2011 at 4:44 pm. This article takes a critical view on the features of an unstable economy. An economy with low levels of productivity has no long term growth prospects. The US economic policy had to be reviewed in October 2008. Immediate measures had to be implemented to ensure that the unemployment trend witnessed was stopped. The long term structural mechanisms were lacking maybe due to tension and panic among the consumers. Surprisingly, the existence of the short term problems was the one prolonging the long term problems such as unemployment. This caused recently graduated students an opportunity to go for training and improve on their skills. The policy makers have a duty to erase all the emergency budgets. One of the perspectives of sociology; functionalism was of the view that the condemnation unemployment provokes- has the most important function of clearly defining its effects. This is the reason why political unrests could occur if the issue is not resolved immediately. Europe's Austerity Programme Spawns ‘Lost Generation’by Julio Godoy (Paris)Tuesday, April 03, 2012 Inter Press Service. This article discusses the emerging problems experienced in the countries in Europe. Particularly, the article examines the Mediterranean member countries of the euro zone that have been rocked by debt leading to financial crisis. ‘Remedial’ austerity programmes have resulted to these countries having hard economic challenges. These countries are basically sacrificing and relinquishing their future to suit their short term budget consolidation. These Mediterranean member countries as Spain, Greece, Portugal and Italy are experiencing a 50% unemployment rate. This affects people who pose high educational qualifications. Those who are lucky are engaged in low paying jobs. Their conservative governments have introduced drastic cuts in terms of spending and tremendously reduced pensions among many austerity measures. As the behaviourist approach suggests, human behaviour will respond by drawing out a stimulus and response. The government has to interpret the concerns raised and act through a response which in this case is the cuts in spending and increasing taxes. The telegraph. Eurozone leaders sign up to budget controls. European leaders agreed on a permanent rescue fund for the eurozone, and 25 out of 27 EU states backed a fiscal pact for stricter budget discipline in the eurozone, while a deal on Greek debt is expected in "days".2012. Hughes. This article reflects on the measures that the European Union decided to take to avert debt crisis. Only two countries of the European Union; Britain and Czech Republic refused to consent to the fiscal compact. This agreement was to impose sanctions on the countries that break the budget deficit limits. The countries decided mutually that the budget rules were to be included in the national law. Prime Minister David Cameron was of the opinion that to end the debt crisis, more would need to be done. Stringent measures had to be adopted if the euro zones were to be completely eliminated. He cited competitiveness as one of the problems that need be addressed. He specifically stated that some countries like Italy and Portugal needed to open up their economies and liberate their labour markets. The article focuses on the measurements taken to revive the growth and create employment during a difficult period when most governments were facing problems and had to cut public spending and increase taxes. The government actions were influenced by the situation at hand just as the symbolic interactionism insinuates. People’s behaviour is influenced by their definition of the situation at hand. Jobs Power Market Rebound. ‘Unemployment Rate Dips to 8.3% on Broad Gains’2012. CONOR DOUGHERTY. This article shifts focus to the gains made by the Obama administration in terms of solving the unemployment menace. The article examines the addition of jobs in the month of January which led to a conspicuous and remarkable decrease in the unemployment rate levels. This was in presidents barrack Obama first full month in the oval office. The labour department brought in new statistics which revealed that employers in the country added a remarkable 243,000 jobs in the previous month. This brought about economic growth and marked a rapid pace of job growth not witnessed elsewhere globally. Statistically, it brought down the unemployment rate from 8.5%-8.3%. The labour markets became more liberal and the stock prices were on an upward trend to the surprise of investors who had witnessed debt crisis a couple of months ago. The conflict theory which is a perspective very vital in sociology states that behaviour is influenced by the social structure in place at a time. Political criticism eases as performance takes centre stage. These are macro theories of the society which exert influence on how people will perceive things. REFERENCES. Rifkin, Jeremy (1995), The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era, New York: Tarcher–G.P. Putnam's Sons, ISBN 978-0-87477-779-6. Ganapati, Priya. Brainy Robots To Lead To Longer Unemployment Lines? October 25, 2008.  Easterly, William (2001). The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics. Cambridge, Massachusetts: MIT Press. pp. 53–54. ISBN 0-262-55042-3. Tabarrok, Alex (2003-12-31). "Productivity and unemployment". Marginal Revolution. Retrieved 2007-03-11.  Bray, Ronnie. Luddite Spring - The Huddersfield Luddite Uprising of 1811-1812. Lyons, Daniel (18 July 2011), "Who Needs Humans?: As if American workers don't have it rough enough, with unemployment skyrocketing and jobs moving overseas, now there's another threat: robots", Newsweek 158 (4): 28. Bajaj, Vikas (2009-11-04), "Should India worry about jobs?", Economix: Explaining the Science of Everyday Life (New York, New York, US: New York Times), retrieved 2010-12-12. The CEO of Infosys talks about long-term perspectives. Tutelian, Louise (2010-11-22), "Disappearing Jobs: High-Paying Careers With No Future", Yahoo Finance, retrieved 2010-12-12. Read More