Impact of Unemployment both to the Employed and the Unemployed

When we speak of unemployment, most of us think that the directly affected will be the unemployed workers. Although it can indeed affect the future of the unemployed financially, even the employed workers will get an indirect effect as a result of increased unemployment within the company.

For example, let us say that a company has to lay off some people in order to protect their assets brought about by slow return on investments or sales. This happens during announcements of redundancies and retrenchments which have been rampant in the last half of the last decade. Firms need to execute this sudden change in order to keep the business going despite of losses. When coworkers are laid off, it is automatic that the firm will not even consider hiring new people to replace the previous ones whose salaries are increasing annually. As an effect, the remaining workers will need to double their efforts in ensuring daily demands in the workplace are met despite minimal workforce. This would mean that the current employees perform more work with lesser or the same salaries. This exercise can yield more profits for the company, but is caused in part by cuts on salaries and other benefits to the remaining employees.

Even employed people will be threatened with their job security when the economy’s unemployment rate increases and more companies are shutting down. They will likely entertain doubts on their company’s stability in these trying times. Especially when the industry the employed worker belongs to is listed as among the weakening industries during a recession, he will be forced to look for other options. It is important to note though that while some industries grow weaker during recessions, a couple of business sectors also thrive. When laid off or about to be laid off, stay positive. There are many alternatives. Just deal with it in an optimistic way and plan out your strategies to get a job immediately.