UNEMPLOYMENT AND ECONOMIC HEALTH
Unemployment can be defined as unused labor. The unemployment rate is gotten by dividing the number of those people who are unemployed with the number of people in the labor force. Unemployment is one of the indicators that aid in understanding the economic health of a country. The monthly labor force survey is the source of the unemployment statistics in Canada. Only those who are above the age of 15 years are put under consideration while measuring the Unemployment rate.
Globally, the issue of unemployment remains to be an economic puzzle, and many economies have tried to caution it. In most countries, the unemployment rate has become a serious economic problem for both economists as well as political leaders. In the globe, Ayhan (2016) unemployment in developed countries seems to slow down while in developed countries, unemployment rates remain a key issue among the youths. Unemployment among the youths, according to Elima (2015), has been cited as the main cause of social crimes. According to the World Bank report 2015, the Africa continent has an amount of 60% of the youths without jobs (Sam, 2016). At an economic level, increased youth unemployment comes with detrimental macroeconomic results. Han, You & Na (2015) argue that unemployment negatively affects the economy, increasing dependency ration, per capita income, income tax, and increasing government expenditure. In the long term, Njeri (2012) suggest that increased unemployment rates may lead to the filling of vacancies as well as increased wage inflation rate.
In Canada, the unemployment rate for 2019 was around 5.67 percent. Most of the Canadians (three-quarters of the workforce) are employed in the agriculture sector, services, and industry sector. The other percent of the employees are at accounting firms. Canada mainly imports and export its goods to the United States. Although the country’s exports and imports have been increasing over years, the value we get after subtracting imports from the exports has been declining gradually since the time Canada experienced an economic crisis in the year 2008. Compared to other countries, Canada seems to be less affected by the economic crisis because its unemployment rate has been decreasing while its gross domestic product has been increasing.Statistical indicator of how the unemployment rate have been decreasing over the last one decade are as follows.2009-8.36%,2010-8%,2011-7.5%,2012-7.33%,2013-7.1%,2014-6.93%,2015-6.9%,2016-6.99%,2017-6.34%,2018-5.83%,2019-5.67%.Compared to the united states, the employment rate there is lower as by 2020 since it was 3.5%.By 2019, sub-Saharan Africa was identified to be the one with the country’s leading in the unemployment rates. For example, Lesotho had 28.2%, Eswatini:26.5% and Mozambique :24.8%. In this countries with highest unemployment rates, they suffer very much from extreme poverty and also they are most affected with HIV/AIDS more so Mozambique making the productivity to be very low and have their manpower lost, On the other hand, the countries with the lowest unemployment rates include,Qatar:0.1%, Niger:0.3% and Laos:0.7%.The unemployment rates for largest economies are; Japan :2.4%,India :3.5%,Germany:3.6% united kingdom ;3.9%,united states:4.1%,China:4.8% and Canada 5.9%.
Over the last 20years, the unemployment rate in Canada has risen at an average rate. In the early 2000s, the unemployment rate impaled for a short period and later started to decline again in September 2003. The unemployment rate had fallen up to 5.8% in 2007 before the great economic recession of the year 2008-09. During this period the rate raised to 8.7% and the Canadian Government was able to absorb this by the year 2011 where the unemployment rates resumed their trend of declining. Since then, the trend of unemployment has been going down up to the year 2019.
Canada is a country that got ideas and policies which differ widely from those of other countries.
It is endowed with forest and adequate oil. As it is with any other nation, Canada got its strengths and weakness too. Some of its strengths include a wonderful business environment. Its business environment is termed to be excellent because the government greatly supports the entrepreneurs in the country by reducing taxes for them or even giving them tax breaks. This makes Canadians feel more confident and not to fear failure once they want to start a business. This is one of the ways that reduce the unemployment level in Canada because many people can afford self-employment works. Being close to Americans is a strength to the Canadians because they receive trade benefits from them This is because most of their products they export to them (three fourth) and also get imports from the Americans. Canada has also managed to develop trade relations all over the world. This adds a benefit to them since they can now be able to increase their profits by supplying their products to more countries. For example, being one of the countries that exports in a niche market for goods like wine, oil, and gas plus other minerals like diamonds, (it has been ranked the fifth producer of oil and gas) its makes the country more powerful and leads to an increment of its gross domestic product and thus reducing its unemployment rate. The capability of having a strong and well-organized and supervised banking sector is also a strength to its economy.
Some of the country’s weaknesses include; High rate of dependency ratio on the American economy. Although we have initially said that Canada is close to the Americans is a benefit, it turns to be a weakness because they seem to depend on them too much to take their exports there. This turns out to be a problem because, when the US is faced with a recession, the Canadian economy will be greatly hurt. After all, it exports over 74% of its exports to the Americans. Another weakness is the unitability of the Canadian dollar which has been fluctuating over time and has resulted in many people losing their jobs. This loss of jobs has led to a decline of the Canadian economy in the level of competitiveness in the manufacturing industries. Fewer expenses in the research and developments are also a weakness of the economy because it will rarely make changes in the running of the economy if it does not invest in doing researches that can lead to new developments. Over some time, though stabilizing now, Canadian households have been faced with a problem of high house prices thus reducing their disposable income and lowering their living standards. Another weakness faced by the Canadian economy is inadequate pipelines to supply energy thus reducing the rate of their exports. It is impossible to supply adequate energy to the coasts and the Americans with the shortage of pipelines. This makes the economy to lose a lot of income that will be associated with the extra supply of energy.
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