QUESTION: From the perspective of your field of study, in what ways does unemployment harm people and society?
A: Caitlin: I think that a lot of people especially in my major are rushing off to grad school cause
that’s all that you can really do unless you are one of the very few talented people who can say I’m going to go be a writer. I think that there’s going to be a lot of issues because there are so many people with loans. There is going to be an entire generation that is going to be massively in debt.
A: James: For a present day example – Unemployment is difficult to describe in historical
context because we haven’t seen the full implications yet. We don’t know what is going to happen yet. But if what is going on today were to be written down in history books, it wouldn’t be written down as wholly economical. I think, at least in the US, you’ve seen a fundamental shift in the type of economy. I think we’re finally seeing a shift into a more service-based economy. And even a recession like this, which is a fairly bad recession, has had a massive effect on the manufacturing sector and unskilled workers. I think that’s the group that’s been hit the hardest – this kind of middle class of the United States. Historically, it’s going to be interesting to see the consequences of this. I think in the future we might have a higher rate of unemployment than we’ve had in the past. I think a lot of it is based on expectations of trade with China, which is really not that bad of a trade deficit at all, and perception among the public. Politically, I think it will end up with the Democrats in power, at least until things are fixed.

QUESTION: What do you think governments can do to reach full employment?
A: William: There should always be some room for unemployment. I don’t know to what extent
that is true but as long as it’s frictional and cyclical as long as it’s not the structural one you don’t want to end up like Europe where you have workers that have to change their skill set. There are social affects that’s what you really want to avoid but aside from that there is a [natural level of unemployment] and that is normal—that creates flexibility and people can go and change jobs and not just do one job forever so that’s a good thing.
A: James: As a history major, I think full employment is very difficult. The only time full
employment was achieved was when you had an agricultural or subsistence farm base
without skill specialization or you’ve had a communist type of economy. I was
recently reading a report in the NY Times that North Koreans who had crossed the border to South Korea had actually found the capitalist system “oppressive” because they couldn’t just go to their factory and work 8 hours a day, but now there were additional forces on them to achieve even more. I think that in the capitalist system, it’s something the government should strive for, but there will always be transitional unemployment that occurs and an inability to utilize people to their fullest capacity. And without a switch to a command type economy, it’s impossible to have complete full employment. Not to say that you can’t bring it low, but it’s impossible to get it down to 0%. The system works in such a way that since you’re not utilizing all a person’s time and effort and that they have individual free will and rights, it makes it impossible to achieve something along the lines of full employment in a capitalist system.

QUESTION: How will unemployment affect you, based on your field of study?
A: Caitlin: It’s going to be a challenge. I don’t want to do grad school right away. It’s cool
because there is a recession: what you are supposed to do is impossible so you have to ask
yourself what you really want to do and you get to be creative as far as how can [you] find something fun to do. It redefines what you do.
A: James: As a history major, I was expecting to be unemployed after I graduated. I feel
like graduate school is almost necessary for a history major to get more specialized. History majors often do well in business. Personally, I would really like to work at a museum which I think I could get because we are becoming more scarce and rare. But despite the fact that we are scarce, I think we will still be affected. Liberal arts tend to suffer, so I think I will be fairly unemployed after I graduate. In terms of the education industry, I think recession is actually not good for it. I feel like it may be a short-term boost, but at the same time the main factors of educational institutions that give it its capital funds are not there. I think we’re having a short term bubble in education and once the bubble pops, you will see a fall in the numbers of graduates. I don’t think we’re all pessimistic about graduating, I think we’re a little bit more opportunistic, especially because most of us are graduating at a time where the recession is not as deep. I think currently there is a, and I use this term loosely, fetishism with university education. You see students who aren’t necessarily interested or equipped in what they are studying. So, I think the universities are currently in the bubble and they will suffer when the bubble pops. I don’t know how much credit rides on university education, but it seems like a fair bit.

As one can see from the interview questions above, the term “unemployment” has different implications for those studying fields outside that of economics. While James answered with concrete facts of the past, Caitlin shared personal experiences with unemployment and William offered several common definitions for the term. With such a diverse population at Franklin, the variety of answers were expected and appreciated. This insight can help us understand unemployment and possibly find solutions for it. Mecpoc hopes to continue this survey of Franklin Students and their opinion of different economic theories, policies and practices. If you are interested in participating in an interview or writing your own article, please contact jpatriarca@mecpoc.org.

Have you ever considered full employment as a means to properly measure the cost of wars? Tolerating unemployment may indeed lead to pro-war sentiments.  Fighting wars requires using resources to produce weapons, feed soldiers, provide transportation. Thus, maintaining chronic unemployment is a powerful economic incentive for war. In a fully-employed economy, i.e., an economy where a full employment goal is constantly and successfully pursued, the need of resources for a war would compete with other demands on resources. War would inevitably entail a reduction of the standard of living. In a fully-employed economy, war costs become explicit and they can better be weighted in with any alleged benefits of fighting.

If you think wars in Iraq and Afghanistan were a gigantic waste of money, chronic unemployment in peacetime may be even worse! War raises output and unemployment is not an efficient allocation of our resources.

Wars raise output only to consume it in battlefields, with no real improvement in per capita standard of living. But the same fervor we use to point to the waste of resources (not speaking of human tragedies) resulting from wars, should equally be applicable to any rate of unemployment above zero.  Unemployment entails a similar, and in almost all cases effectively in greater magnitude waste of output that is not produced in the first place.