Why is the unemployment rate so high in other countries compared to the US?

Answer 1

They don't lie as much. Under Reagan the formula for figuring the UI rate was reconstructed to be figured differently just to make him look better. It's at least double or triple what you see reported.
Now they don't count anyone who works any at all as unemployed even if they can only find work for 8 hours a week. They don't count anyone in the military or reserves as unemployed even if they are not in active service and need a job. They don't count anyone on any sort of a private UI as unemployed, anyone over 65 or under 18, etc.

Answer 2

In general the US rate is lower than Europe because we do not provide a very generous welfare benefits to the unemployed, so in the US people will take any job instead of waiting for one they want. High taxes will cause some people to decide not to work, particularly for a second income in families with with children, but this does not cause high unemployment because they have made a choice not to be part of the labor force so they do not count as unemployed.. Some counties (France) have labor laws that make the work force inflexible.But when comparing statistic between countries you need to be careful. Unemployment varies over business cycle and we are at the peak but not all countries are. Also unemployment is measured differently in different countries. The US counts only those activity seeking work, some countries count anyone who would like a job but doesn't have one, that is what we call discouraged workers.

Answer 3

I'm also disappointed with many of these answers. Some of them have a dash of truth to them but none of them are really good.

The real reason the US has a low unemployment rate can be attributed to a long list of reasons. Some of the smaller reasons have been mentioned already... differing labor laws, number of jobs to qualified work force members.

A big one, however, has to do with how the labor force is defined. It's defined as people who are able and *willing* to work. The unemployment rate is calculated as those who do not have a job and who are *actively searching for a new one.*

Why is this distinction important? The US has one of the most rewarding social programs for people who do not have a job. Welfare lasts a total of 26 weeks (half a year!) and you get paid as long as you are proving that you are actively looking for a job (which is a very easy thing to "prove"... you only have to report two employers in your area that said they did not have an appropriate job for you per week). Welfare's "goal" is to encourage you to get a job and to pay you until you find one, however, you do not have to accept a job with fewer or greater qualifications or less pay (!).

Needless to say, many people use and abuse the welfare system, and many people use the welfare system for the full 26 weeks (you get paid to do nothing). They are not really looking for a job during this time, and so they do not count as "unemployed" rather, they are considered "discouraged workers" (people who do not have jobs who are not looking for work), and are not factored into the unemployment rate.

I'm sure there are also many other factors at play, but I just wanted to toss out something I don't think people think about too often.

Answer 4

Relatively low amounts of government meddling in the economy and market is the main reason. Take France. The government regulates HUGE parts of thier economy. The result is high unemployment (near 10% I think) and low productivity.

It is also very burdensome and lengthy for employers to fire workers.

You might also want to look at tax rates. Lower taxes mean a pumping economy. Do you think it is merely a coincidence that the US economy started to slide about a year after Clinton raised taxes, and the economy righted itself and started skyrocketing about a year after Bush lowered taxes? The less people pay in taxes, the more the private individual has. If a private citizen has more money s/he will do one of three things with it. Spend it. Save it. Invest it. If a person spends it, it goes back into the economy to a company. The company uses that money to grow/expand. If a company grows and expands, new workers are needed. A person may choose to put money in a bank and save it. Banks use said money to invest in businesses or help new ones. New businesses mean more jobs! Investing it does the same thing.

Also, if you have lower taxes, people tend to be less disgruntled about having to pay them. The result is more money coming in.

Let's say 100 people have to pay $100 in taxes. But, 20 people are upset that the tax rate is so high. So, only 80 people pay it. The government gets $8000. Then the taxes are lowered to $90. To some people, that is a more reasonable rate. So, you get 90 people paying taxes. The government gets $8100.

So, which is the better deal for the economy, people and the government? Answer that question and you get the answer to yours.

Answer 5

What a bunch of dumb a** answers. The US has invested heavily in keeping people employed. After the great depression departments like the FED were created and/or heavily funded with its sole mission to keep unemployment low and inflation low. The reason US unemployment is low is becuase of the Federal Reserve. When unemployment is high they will lower rates causing more borrowing and investment. When unemployment is too low they will raise rates to slow down the economy to keep inflation low.

Interesting fact. Ben Bernake wants to keep unemployment as close to 5 % as possilbe.

Answer 6

European "welfare" countries have high unemployement b/c they mess with the economy.

See, they made it very hard and expensive to fire a worker, so now firms avoid hiring people unless they are 110% sure they really need those workers.

High & perpetual unemployment benefits also increase unemployment, since you can actually have a decent life w/o working.

Answer 7

the excellent difference it particularly is that the european union has a greater robust huge risk-free practices information superhighway for human beings that are no longer any further able to artwork. the situation interior the U. S. human beings who pass unemployed just about on the instant away replace into non-enticing interior the financial gadget with the help of using certainty they have not have been given any earnings. the human beings interior the european can although spend with the help of using particularly some social schemes that grant for them. u.s. retains a flexible workers industry (human beings ought to be layed of better certainly) the european union has law to ward off human beings from being layed of with some exceptions. those schemes interior the european grant stability for the two the financial gadget and for the persons that stay, yet additionally they dampen the upward strengthen.

Answer 8

As long as people see the reward of their efforts, they will be willing to work. Because of things like high taxes, national heath care, government regulation many countries have economies that discourage people from working because they see no reward to their efforts.

Answer 9

NationMaster.com has our unemployment rate fairly low compared to other countries. I would guess because we are a heck of a lot richer than we care to admit.

Answer 10

Because they have figured out that employment is the new age slavery. Our economics are based upon the idea of slavery. Just because you get a paycheck you still have to pay it out to live. Slaves in the past may not of recieved a paycheck, but they were giving a way to live. The only thing that has changed over the centuries is the fact that we have a choice of what we eat and where we sleep. We are still slaves to an economy. Once you look at employment in that manner it changes the way you think about working. Some get it, some don't. The U.S. just makes it more appealling.