The Main Reasons For Unemployment In Developed Countries

There are many reasons for unemployment in developed countries. This article attempts to list these main reasons with a special look at the subject from an African and Caribbean perspective in the United Kingdom. After a brief history of mass employment we also look at the power of the media and it's influence over the citizens of a country. The bias nature of the top UK business in terms of leadership is also investigated.

Loss Of Heavy Industry

The developed countries over the past couple of centuries have moved away from agriculture to industrialisation. Farming was once a mass source of employment. The machine driven by steam meant that jobs on the farm land began to decline. A migration from rural areas to cities occurred. People moved to cities for work as a way to feed their families as the jobs there were higher paying. Into the twentieth century heavy industry based in the valleys near a river source started to employ the masses.

Over time heavy industrial processes became important contributors to a countries economic power and in turn these have been in the past been big employer of people. Examples of these industries have been steel production, coal mining, ship building, car manufacturing, industrial engineering services supplying armament, building plants for this industries. All this has involved manual work mainly by men and long supply chains which rely on many smaller businesses. Once one of these industries is lost to an area. Businesses go bust and unemployed become wide spread. A whole industry disappearing means the destruction and total collapse of many communities.

Ports Hit By Unemployment

Areas in the country hit by the lost over time of big employers have been the ports of the UK. Liverpool, Glasgow and Bristol were built on the import, export trades in shipping raw material, manufactured good and people around the world. Huge profits were made and wealth created. They were once magnificent cities in their heydays of the 18th and 19th century. Again heavy industry was involved. Decline in Britain's power in the world come about after world wars, these cities began to lose their heavy industries, subsequently unemployed begins to rise. The road to recovering past economic glory has been long and difficult for some of these metropolitans. Other examples around the UK are the dock areas of Chatham in Kent, East London and naval areas such as in Plymouth.

There are more examples in the industrial areas of the north east as in Middlesborough. Once known for steel making and chemical factories. Then there is Sunderland for coal mining and shipbuilding. Furthermore Manchester was once a place where there was wool, silk, and cotton being manufactured the textile industry was one of the biggest components of the industrial revolution and it was through the cotton and textiles trade that Manchester first put itself on the map. This was industrial mills supplying the nation and beyond with high quality cloth for clothes.

Birmingham too had many manufacturing companies but this was based on metal working industries. Manufacturing centres like Coventry, Luton and Dagenham had massive car production plants. These jobs have been lost to the far east because there is a low cost of labour to business and then more loses to computer driven robots. These jobs in a world of global trade will not be returning to the UK anytime soon.

A Move From Products To Service Jobs

There has been a change from the industrial economy driven by coal, to the oil industry. Then next change has been towards information and the complex technology driven economies. Over a short period of time, decades,  developed countries have lost their manufacturing bases to a majority service economy. This has especially been the case in the UK. These service industries sectors are complex in which the following key examples are:

  • banking
  • finance
  • insurance
  • accountancy
  • medicine
  • medical science
  • environmental science
  • data science
  • design
  • software development
  • programming
  • construction
  • engineering

Here citizens need to design, develop and take advantage of their companies intellectual property, the knowledge in the companies database, client customer database, the branding and marketing know how. Other areas of a need for staff are in health care and the teaching profession. Furthermore with the increasing awareness of environmental considerations, environmental entrepreneurs will be finding opportunities in all sectors.

Unemployment has be a main stay in UK areas where people have not be able to transition to these sectors, by either education or mobility reasons.

Citizens Not Having The Education

High quality careers and jobs in developed countries requires citizens to have a first class, high quality education as a perquisite to access opportunities in work. The reasons is because information technology is central to employment today in as much as the tools of the modern economy are based around computing. The ability to perform the jobs of today and the future means an individual will have to keep up to date in the latest computing software skills. Innovation in a modern company means some of if not all the staff need to be compute literate,  ready to innovate. This only comes through extensive training in higher education over many years or apprenticeships.

Moving an individual who has little to no education to a contributor in a moderns economy is no easy task in fact the project is a mammoth one which nobody should underestimate. The end product is to produce an employee full of talent that is highly efficient in creating wealth.

First Class Infrastructure

The power of first class infrastructure in the contributions to opportunities should never be underestimated. A country, region or community must have first class infrastructure in place for it's citizens to be able to contribute to a modern economy. The following have to be in place:

  • Essential always on services such as water, electricity and gas
  • Affordable homes, safe, quality accommodation
  • Quality health facilities (social care, mental health and sexual health)
  • World class telecommunication services, super fast broadband internet connection (fibre optics) and mobile coverage
  • Quality transport into cities, town of work, either by road or rail

World class businesses rely upon these fundamentals being in place. A progressive highly developed country should be structured around these services in all regions through out the country. For instance a well connected district transforms a citizens work and social life. Poor connectivity has far reaching consequences as it reduces access to employment opportunities. Telecommunication and transport services are required for a citizen to be able to plan, network, upgrade skills, get one to one support, get access to work advice, search for jobs and apply for jobs. See for more on fair access. If there is imbalance in one part of a country compared to another then there you will find differences in employment. The question is who pays for correcting the imbalance, government through taxes or private investment and businesses?

Centres of excellence

A long term objective in mind of all the above happening is to foster centres of excellence in a region that once had in the past heavy industry for example advanced robotics, environmental problems solving, medical research or space hardware construction. All this means experts in the knowledge economy are in the local area. This will take time and this will be a long term commitment by local government. Our mind sets should be changed to supporting home grown talent. Artists or craftsmen and craftswomen producing small high quality custom made goods which can solve environmental problems need to championed. The promotion of buy or spend local, save the environment should feature in marketing campaigns. Do not go aboard visit Blackpool, North Wales or Yarmouth and holiday at home.

The new high street as a local centre of excellence

The high street is a place that people are not visiting as frequently as they did 10 or 20 years ago. Money is now spent online. The high street is now a place you find, coffee shops, betting shops, nail bars and the hair dresser. In addition you find many charity shops as they can take advantage of concessions giving to this sector. The ability to substance a business on the high outside of selling low quality food is difficult. Living local, working local and spending local needs to be revived by the communities in these areas. The high street can be a place for excellence in serving the communities with local issues such as cleaning our streets, servicing our elderly or providing more quality housing. The model for this is seen every week up and down the country on a Saturday. Yes just as Park Run has been a force of local people keeping fit. We need a force for locals solving local unemployment. Our attitudes need to change for this to be a new way of creating employment, it is possible to do this if this is linked with upcycling, recycling, saving money, saving energy and long time projects beyond our lives.

The Rapid Speed Of Change

The complex technology area is all about rapid change, this is change many time in a persons lifetime as apposed to over a life time. It can be describe as a shock if you do not see it coming and are not prepared. Technological change is constantly putting people out of work Jobs are destroyed and Jobs are created.

This swing has an effect on Africans and Caribbean more than any other community see They are the last to get hired and the first to get fired, because of the institutional racist nature of companies. Even if a person from African or Caribbean heritage is qualified this may still  not be enough for them to get a job, get into management or keep being employed if in work. This can have a devastating effect on their family and community. Solution for them are around starting their own business.

Hire And Fire Culture

The rapid change in business models has led to the rise in legal structures for employment swing in favour of the employer. The business owner employs tactics like employing contractors only, zero hour workers. This means a citizen has many jobs in his or her life time. It is a case of every man and woman for themselves. You are not able to do it I will find someone who can this is the attitude of I will do is myself if I can. The citizen who is involved in or perceived to be orchestrating the most complex task in an organisation is the last person to be fired at work.

The Cost Of Employment

Wages, national insurance, pensions contributions and medical insurance are cost an employer has to make in many businesses. The cost to a SME* employer taking on new staff in a department may discourage them in doing so when they work out the financial numbers. The decision maker become risk adverse. The numbers may mean they outsource a service or business unit to another business overseas. Another option open to the most scrupleless manager is to pay less for a service based on a person's race or colour. This is happening today see report The report talks about an ethnic pay gap. Employees Black African, Caribbean or Black British on average earned 5% to 10% less than their White British counterparts between 2012 and 2018. see ONS.

Weak Leaders Weak Management Weak Decision

The decision made by government or private organisation is a factor in unemployment or employment. The question to be asked is do the leaders who make decisions think in the long term? Can they sell this to the citizens of their countries. Will the leaders keep going back to the same well? Same types of people to employ, same messages through the new media channel.

Who moved my cheese is a book about change. The anticipation of what is to come and making decisions based on this change. Unrest in the population in not to be ignored as unemployment has serious implications. If a group of people based on their race or colour is constantly excluded from positions of power then extremist attitudes will follow.

It is obvious the current leadership is not diverse enough to see this though and should be moved out. This must be said for all industries and all sectors. For example in the top flight business of football the personnel of management is white men. From the management of the club to the journalist covering the game in the local or national papers it predominately white. Another example is the publishing industry management is dominated by white middle class staff. The journalist and publishers on or offline covering football have a bias that reflects their sex, colour and race which they can not deny. Therefore how can they ever write and publish with true insight about the many black players plying their trade in the game week to week. How is it that many of these player have not transitioned into these roles.

The power of the media in owning, creating and publishing their content is crucial in influencing the citizens of a country. Every word, image can be bias by intent. Many times citizens are unaware of this. Social engineering to change attitudes over time uses the tools of marketing. Every year the population is bombarded with the event at the year's end Christmas. If the level of energy that goes into this event is put toward tackling unemployed then we would surely see positive outcomes.

Skill Gap Means Unemployment

In summary the reasons for unemployment in developed countries are complex. There will always be unemployment due to the skills gap or lag in time to fill that gap in skills. *Business moves faster than the citizens who are employed by them which means a constant learning culture needs to be fostered for all. This needs to be integrated into the working week and at other times if possible. Fast reaction times are a must to stay in the game. Efficiency is key to survival.

Manual low paying jobs means a citizen will never be able to move above the poverty line as there are no long term prospects and opportunities to advance. The job is never stable and this means the person's life is at risk. The risk can manifest itself in many ways including extremist action. The low paying, hire and fire jobs are ones in which ethnic minorities in the UK are to over represented in. To break this chain of dependency in unstable jobs a total commitment must be made to support black African and Caribbean entrepreneurs in starting and developing their businesses, as due to the institutional racist nature or bias of top UK businesses today people of colour will not find themselves in leadership roles to be able to taken up employing the people needed to be in work based on their true talent and not their colour.


West Africa Phones

Speaking, listening and communication assessments Level 1 and 2
Topics for formal discussion level 1 and presentation Level 2 Unfamiliar topics

City and Guilds ideas and opinions. Evidence. Effective accurate language

If you wish to use this article for your City and Guilds informal discussions familiar topics please do so. Cut and paste. For use as a presentation use the following:

  1. Title: The Main Reasons For Unemployment In Developed Countries
  2. Content: 
  3. Loss of heavy industry
  4. The ports hit by unemployment
  5. A move from products to service jobs
  6. Citizens not having the education
  7. First class infrastructure
  8. The rapid speed of change
  9. Hire and fire culture
  10. The cost of employment
  11. Weak leaders weak management weak decision
  12. Summary: Skill gap means unemployment
  13. References


*This can be said for smaller businesses which are the mains employers of staff in the UK. Typically employing 10 to 50 people.