2. DEALING WITH
UNEMPLOYMENT
When industrial capitalism came about, one’s economic well-
being was almost entirely tied to employment. There were no
legal alternatives.
People lived. They found sustenance one way or another, or
they perished.
Before industrial capitalism, unemployment was not an issue
because there was not this idea of work and wages being tied
together.
3. EARLY GOVERNMENT
ATTEMPTS TO
ADDRESS
UNEMPLOYMENT
Early on, unemployment was thought of
as a natural consequence of the
business cycle. There was nothing a
government could do but alleviate
some of the effects of it.
However, too much unemployment will
lead to protesting and rioting, so
something needs to be done.
In the UK, the government offered tax
incentives to move factories to areas of
high unemployment
They encouraged people to move from
depressed to prosperous parts of the
country
As a response to the Great Depression
in the US, the New Deal was
implemented as well as Social Security
and some level of unemployment
benefits.
4. ROLE OF THE
GOVERNMENT IN
UNEMPLOYMENT
• Around World War II the government thought that it
could do more than just alleviate the effects of
unemployment. They could create employment.
• Industrial countries had a goal of full employment
• State policies tried to ensure demand for goods and
services remain stable
• If the people are consuming more, then demand will
increase and there will be more jobs.
5. UNEMPLOYMENT
IN THE 1970S
AND 1980S
This was a result of the decline of Fordism (and deindustrialization)
• The markets should just naturally handle it. Governments should not intervene, and trade unions should not get
involved
• Controlling inflation was more important than controlling unemployment
• This view has persisted (with ebbs and flows) until today
• During all three eras of unemployment crisis in the last 100 years, we have stayed with these views
As unemployment went up, people switched back to the views they had in the early 1900s
6. WHAT DO WE MEAN BY
UNEMPLOYMENT?
For mostly political reasons,
government often alter the way we
measure unemployment
In general, we use the International
Labor Organization’s (ILO) definition:
A person of working age is
unemployed if they are:
Not in employment
Actively seeking employment
Available to take up employment
7. WHAT ARE THE
HISTORICAL
UNEMPLOYMENT
RATES
1930s
After the Great
Depression in the
1930s: around 20%
1950s and 1960s
less than 5%
1980s
around 10%
2010
(after the recession of
2008-2009): just under
8%
Today
a bit less than 4%
8. JAHODA’S DEPRAVATION THEORY OF
UNEMPLOYMENT
• Jahoda looked at the impacts of mass unemployment on the small town of
Marienthal, Austria when the main employer, a textile factory, closed in 1932.
• 75% of families were dependent on unemployment relief
• Aside from growing some vegetables or raising rabbits there were few alternatives
• The effects:
• Since unemployment payments were made every two weeks, economic life of the village
revolved around this two-week cycle
• When a pet goes missing, the owner doesn’t report it. They don’t want to find out who ate
it
9. EFFECTS OF
JAHODA’S STUDY
Despite the increase in free time, there was a decline in social
activities. There was a loss of confidence and a sense of shame,
so people did not socially interact as much
For men, the time of day no longer mattered. They just sat
around becoming useless. Sense of time disappeared
For women, they were busy with household tasks. Little
changed for them in this way.
Families, including children, felt a sense of aimless,
hopelessness, and resignation.
10. SUMMARY
OF
JAHODA’S
STUDY
• Work has manifest functions like earning
income, but it also has latent functions
(functions not directly seen)
• Work is crucial to social and psychological health
11. UNEMPLOYMENT
AND CLASS
It also influences how people see unemployment.
Ashton looked at which factors influence this:
A person’s status in
the labor market
The extend to which
their occupational
identity is central to
their image
Their financial
situation
Their identity in the
family
Research shows that those in lower classes are more
susceptible to unemployment.
12. Other research points to one’s income status as being more important in unemployment
This suggests that lower classes have fewer
cash reserves on hand and are thus
affected more
Daniel’s research in the 1990s showed that
a reduced cash flow was the main problem
with unemployed manual workers as
opposed to middle class
However, a sense of shame was more
important for non-manual workers
Fineman showed that the sense of shame
was prevalent in white-collar workers as
well.
Some research suggests that the higher the person’s status in the labor market, the more affected
that person is by unemployment
This would suggest those in higher classes are affected more
However, research on unemployed miners and steel workers show that identity is the
main factor when unemployed
13. UNEMPLOYMENT AND AGE- THE YOUNG
• The young tend to be over-represented in unemployment statistics
• They tend to respond by:
• Taking on precarious (temporary or part-time) work
• Jahoda’s research showed that they could resign themselves to their situation
• Jahoda also showed boredom, lack of activity and sense of purpose
• This stands in contrast to how we might expect youth to act
• Research shows that the young are less effected financially when unemployed, but there are
sometimes long-term harmful effects on future employment, happiness, and health
• They may simply delay transition into full adulthood
14. UNEMPLOYMENT
AND AGE-
MIDDLE-AGE
Middle-Age full-time workers are hit
harder by unemployment due to their
financial responsibilities and their
commitment to the job
Older people can face age
discrimination, so it is harder for them
to find work
15. UNEMPLOYMENT
AND GENDER
She reviewed her research in 1980 and concluded
that unemployment had a varied impact on women
Some women were stay at
home and weren’t affected
Some working women went
back to the status of stay at
home, so the negative affects
were minimal
Some women were negatively
affected depending on age,
skill, and status of the partner
Johoda’s research in the 1930 showed that
unemployment had a minimal impact on women as
their jobs pertained to the household and the
structure of their day was not impacted.
16. The first large scale study on female employment saw two types of work patterns (1984):
•Continuous
•Paid employment is central, mandatory and consistent
•This applies to all adult males and some women
•Discontinuous
•Work is marginal and optional
•This applies to most women but rarely men
Unemployed women tended to reject the label ‘unemployed’ especially if they were married or under no financial constraints
Some research shows that the effects of unemployment can be just as severe for women.
•They suffered from loss of status and satisfaction
•Women’s domestic role is no compensation
Later studies (since the mid 1990s) show no difference in negative effects between men and women when becoming unemployed
17. UNEMPLOYMENT
AMONG WOMEN
In general, unemployment research shows that
gender inequality in the workplace still persists
Research on unemployed women has shown three
features common to unemployed women
They are less likely to be
geographically mobile to find
a new job
Unemployed women are more
likely to take part-time work
than men-- especially if they
are married with children
Unemployed women end up
taking on an even greater
share of the housework
18. JAHODA’S STUDY
TODAY
• Her study took place in the 1930s in Europe. Can we
still accept these results today?
• Most modern-day studies confirm her work. What
she found true then is still the case today. There are a
few minor exceptions:
• In her study, the lack of time-awareness was one of the
largest effects. Today this is not the case. Rather, it is the
loss of income or status
• Fryer’s Agency Restriction Theory contends the
following:
• People are active agents striving for self-determination
• The reason that people become resigned to
unemployment is the dwindling back accounts. They must
seek unemployment, etc. This leads to the problems
described by Jahoda rather than simply not having a
purpose because they don’t work
19. AUTOMATION
AND THE END OF
WORK
Some ‘end of work’ theorists like Offe, Granter, and Beck argue
that the experience of work has become so diverse that it has
lost its source as collective identity and organization
However, many don’t agree about when this might occur or if
we are even headed in that direction.
We may be misunderstanding our roles in the information
economy. Work is being intellectualized. We will will, but the
idea of work, as we know it, will change.
20. THE END OF WORK
• However, many point to technology and AI as being able to reduce work hours
• We can’t simply put people out of work though. Remember that mass production involves mass
consumption.
• Some envision a universal income scheme
• Look up Presidential candidate Andrew Yang, who is also proposing a version of this
• Others consider voluntary work with generous benefits
• Another consideration is changing the stigma that comes with not working
• However, consider what happened to people in Yahoda’s study. She claims this is because of lack of work,
not lack of income. Most concur with her.
