Cost of Unemployment

Cost to Individual Loss of income - Low (material standard of living) The longer a person remains unemployed, the more difficult it is to find a job o Skill levels depreciate o Workers are not up to date with new technology o Reluctance by employers to employ workers who have been unemployed for a long period of time for fear something is wrong Psychological costs o Shame for being unemployed ( relying on others to support you) o Mental problems o Higher suicide rates o Divorce o The unemployed feel they have failed themsleves and their family.

Cost to society Unemployed workers are: o Waste of scarce resources o Lower output o Economy is within its PPC o Lower material standard of living

Cost to government Increased expenditure on state/ welfare payments to the unemployed (Job Seekers Allowance, income support, housing benefit) Lower tax revenue - income tax & VAT revenue decrease

Cost to community Some communities/areas can experience high concentations/ pockets of unemployment due to the presence of de-industrialisation which has resulted in the loss of manufacturing firms & jobs located in the UK. With these pockets of above-average unemployment come further/additional costs: Robbery, theft, mugging Town centres become run down reduction in spending by consumers closing down of shops, restaurants,shopping centre Housing estates become run down Vandalisme