What's the Best Way to Prevent Unemployment?
How to Avoid Your Own Unemployment
The best way to avoid unemployment is to get employed and stay that way. There are two schools of thought as to the best way to do that.
The first approach is "Do what you love and the money will follow." This philosophy states that, if you follow your passion, you'll become good at it. You'll put in the time required to master it. Just as important, your enthusiasm will be contagious. That approach often works, because enthusiasm and expertise are critical to employment success.
The second approach is to look at which industries are creating jobs and get the training needed to enter one of those fields. If you have a passion for one of these areas, consider yourself very fortunate. Here are three steps to take:
- The Job Opening and Labor Turnover Report, called the JOLTS Report, tells you which industries have the greatest number of job openings. That's usually business services, as it's also the largest sector in the economy. Healthcare is creating lots of jobs since it is growing fast. There are also a lot of opportunities since it requires training. As a result, healthcare employers have trouble finding qualified workers. Get trained, and you will get a job. Manufacturing jobs, on the other hand, are not increasing at the same rate. JOLTS will let you know, in general, who's hiring and who's firing.
- The next step is to look at Industries at a Glance. That gives you detailed information about each industry, including wages, the number of jobs being added, and the overall health of the industry.
- Once you've selected your industry, the Department of Labor provides the Occupational Outlook Handbook. It tells how to prepare for specific jobs within industries.
The Best Way for You to Prevent Unemployment
The first approach might not work if there are few opportunities. You will find the field to be very competitive. An example is becoming a movie star or a professional sports player. You may need a great deal of luck to make a living at it. You might get frustrated when you are regularly turned down. You could also lose time in the early part of your career to a pursuit that doesn't pay off. Then, when you are in your thirties or forties, it might be too late to begin again.
The second approach might not work if you ignore your values or what you enjoy. You might spend years training to become a nurse, only to find out you get queasy at the sight of blood. JOLTS will tell you there are lots of opportunities in retail or restaurants. Unfortunately, many of those jobs don't pay well. Others don't give you a chance for promotion. If you're not happy in your work, you won't be enthusiastic. That will also harm your opportunities for advancement.
A balance between the two approaches is the best method for preventing unemployment.
Use your passion to start a home-based business. Then, use the JOLTS to find an area that provides additional streams of income from part-time work. That's why many actors wait tables while working hard to get that big break.
What if you aren't starting out and need to stay in your existing industry? Then you must engage in continual training in your field. You can use JOLTS and the Occupational Handbook to find areas within your area of expertise that are growing. You can get training for those specific areas.
The best way to prevent unemployment is to improve your skills constantly.
Every dollar you spend on training is an investment in your best product, yourself. Use JOLTS and the Handbook to look at areas that pay well and that you might enjoy. Take classes on anything that sounds interesting. Apply for jobs that sound like fun. That will give you experience in job interviews. Improve your math, speaking, and writing skills. All employers look for someone that presents themselves well.
How the Government Prevents Unemployment
The government also works to prevent your personal unemployment. Elected officials lose their jobs when too many people are jobless. What is the government doing to control unemployment? First is expansionary monetary policy. The Federal Reserve reduces the fed funds rate, lowering interest rates. When loans are cheap, businesses will borrow to buy capital equipment and hire workers. Low-interest rates also encourage people to buy houses and automobiles and increase personal consumption spending.
Second is expansionary fiscal policy. The president and Congress reduce unemployment by directly creating jobs. They increase spending on government projects, as happened in the New Deal and the Economic Stimulus Program. The best unemployment solutions are increased spending on public works and education.
Congress also gives people more income to spend by cutting taxes like the Bush tax cuts, specifically the 2001 Economic Growth and Tax Relief Reconciliation Act and the 2003 Jobs and Growth Tax Relief Reconciliation Act, and the Obama tax cuts in 2010. They stimulate spending just like an interest rate decrease.