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Unemployment - Coggle Diagram

- - - - people unemployed --> no income --> no income tax --> lower revenue for tax --> government also has to support unemployed through unemployment benefits --> extra expenditure by the government (may cause a budget deficit)
    - - consumer confidence falls --> willingness to spend falls (as people try to build up precautionary savings) --> fall in C --> fall in AD --> further fall in employment and real GDP
    - - poor become poorer (tend to be those suffering from unemployment, more concentrated in certain groups of the population) and rich become richer (as they tend to be able to retain their income due to their higher skill level) --> increase social tension and unrest
    - - unemployment is a wastage of scarce resources --> loss in potential output (lower quantity of workers) as the economy is operating well below full employment level (real GDP contracts as the unemployed could have been producing smt of value to the economy but aren't able to do so) and economy is deprived of higher output and SOL
        longer period of unemployment --> greater loss of skills and motivation --> fall in the quality of labour --> reduce potential economic growth
  - - - unemployed --> loss of income --> borrow to survive --> loss of self esteem
        unemployment --> lower levels of health, family tensions, psychological stress and even suicide
    - - unemployment (esp if it is unequally distributed) --> increased social tensions --> increase in crime rates, drug abuse, violence and homelessness