Happy Deepawali Bonus Statement “Job loss is a Good Sign for Indian Economy" Piyush Goyal's
I have seen your profile over the Wikipedia and no doubt it is quite impressive as you are Minister of Railways and Coal in the Government of India, Cabinet minister & currently a Member of Parliament (Rajya Sabha). You have a strong academic record - all-India second rank holder Chartered Accountant and second rank holder in Law in Mumbai University. You have participated in Leadership Programs at Yale University (2011), Oxford University (2012) and Princeton University (2013) and Owner / President Management (OPM) Program at Harvard Business School.
But one of your statements is not up to the mark as far as Indian Economy status is concerned. A Father or a family head has to play the role of bread winner for their family so in this context your statement “Job loss is a good sign for economy" is not acceptable to me by all means. Unemployment is universally recognized as a bad thing. While Shree Peeyush Goyal and current Modi Government make convincing arguments that there is a certain natural level of unemployment that is essentially required and good for the Indian Economy, elevated unemployment imposes significant costs on the individual, the society and the country. Worse yet, most of the costs are of the dead loss variety where there are no offsetting gains to the costs that everyone must bear.
In addition to many different indicators such as GDP, inflation and interest rates, the unemployment rate of a country is a very common measure for determining the health of an economy. I am sure that in my first economics class here @ DMS IIT Delhi I have learned that unemployment is a key macroeconomic indicator to determine the health of an economy. If there are fewer people with jobs, then they have less disposable income to spend on investments.If one person losing his job, there is one less person that will pay #GST and income taxes, one less person that will pay additional sales tax revenue as a laid off worker will instantly cut back on their non-necessary spending due to less disposable income and worry about future financial security.In addition, practically every unemployed citizen in the India will become parasite & will start slowly sucking money from the economy rather than contributing to it in the form of taxes, thus increasing the State's deficits and tax revenue.
If the above said phenomenon continues to rise quarter by quarter, the Government will probably raise taxes in order to compensate for that loss in tax revenue, thus forcing everyone, both employed and unemployed, to experience a loss of disposable income. Again that loss in disposable income becomes a ripple effect, and less money will be spent in the economy, leading to more people losing their jobs and it starts to become a vicious cycle. Thus Unemployment means being out of job or a situation where the individual is willing to work but has none.
Indian Government not only has to deal with the lost income and decreased production but also with additional cost. The spending power of an unemployed person and his/her family decreases drastically and they would rather save than spend their money, which in turn affects the economy adversely. With this increase rates of unemployment other economy factors are significantly affected, such as: the income per person, health costs, quality of health-care, standard of leaving and poverty. All these affect not just the economy but the entire systems and the society in general. Here are some aspects of the impact of unemployment on our society:
Unemployment affects not just the person himself but also his/her family and in the long run the society where he lives. Unemployment brings with it despair, unhappiness and anguish. It forces people to live their lives in a way they do not wish to – The life expectancy is negatively affected. Life expectancy is the ease by which people living in a time/place are able to satisfy their needs/wants. Here are the main aspects:
Mental health: Mental health problems like: Law self-confidence, feeling unworthy, depression and hopelessness. With the lost income and the frustration involved in it, the recently unemployed may develop negative attitudes toward common things in life and may feel that all sense of purpose is lost. Frequent emotions could be – low self-esteem, inadequateness and feeling dejected and hopeless.
Health diseases: The unemployment overall tension can increase dramatically general health issues of individuals.
Tension at home: Quarrels and arguments at home front which may lead to tension and increased numbers of divorces etc.
Political issues: Loss of trust in administration and the government which may lead to political instability and riots as well as increase of crime rate.
Tension over taxes rise: Unemployment also brings up discontent and frustration amongst the taxpaying citizens. In order to meet the demands & fund the government many a times may have to increase the taxes thus giving way to restlessness amongst the taxpaying citizens.
Insecurity amongst employees: The prevailing unemployment and the plight of the unemployed people and their families may create fear and insecurity even in the currently employed people.
Crime and violence: Increase in the rate of crime.
Suicide cases: Increase in the rate of suicide attempts and actual suicides as well.
Social outing: Unemployment may bring a decrease in social outings and interactions with other people, including friends.
Stigma: Unemployment brings with more than just ‘no work’. It also brings with it the disgrace that the person has to bear. Nobody likes to be termed as unemployed.
Standard of leaving: In times of unemployment the competition for jobs and the negotiation power of the individual decreases and thus also the living standard of people with the salaries packages and income reduced.
Employment gaps: To further complicate the situation the longer the individual is out of job the more difficult it becomes to find one. Employers find employment gasps as a negative aspect. No one wants to hire a person who has been out of work for some time even when there’s no fault of the individual per say.
Lose of skills’ usage: The unemployed is not able to put his/her skills to use. And in a situation where it goes on for too long the person may have to lose some of his/her skills.