Macroeconomics: What are the Main Causes of Unemployment in an Economy?

Unemployment is present in every economy and measures how healthy an economy is. It is when workers who are able and willing to work don't have jobs. It is quite impossible to reach zero unemployment no matter how high aggregate demand is because there is always 'natural unemployment' that would occur in most businesses booms. A country measure's unemployment by taking the unemployment rate, which is the number of unemployed, expressed as a percentage of …

…'Keynes' argues that this happens slowly therefore there is unemployment as wages are always growing. This type of unemployment extends across the whole economy and industries. There are many types of unemployment in an economy and there are many causes of this, which has been noted above. The consequences are social cost for the economy and many unsatisfied wants and loss by reducing aggregate income and inequality since the unemployed lost more than the employed.