ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -In total, unemployment in the region increased by almost 16 per cent to reach 37.6 million people at the end of 2009. Similarly, the unemployment rate increased to 4.4 per cent of the workforce in 2009 from 3.8 per cent in 2007.

Detailed explanation-2: -It has now been a decade since the start of the Great Recession-the most severe economic downturn in the United States since the Great Depression. In a 2-year span starting in December 2007, the unemployment rate rose sharply, from about 5 percent to 10 percent.

Detailed explanation-3: -Why Unemployment Rises During a Recession. Because a recession is a slowdown in economic activity and labor is a key economic input, along with capital, it is logical that unemployment would rise as output (what companies make and sell) declines as companies making less and selling less need fewer employees.

Detailed explanation-4: -In a recession, the unemployment rate-the percentage of the total labor force that is unemployed but actively seeking work-tends to increase as companies cut back on staff to reduce their expenses.

Detailed explanation-5: -The global recession that followed resulted in a sharp drop in international trade, rising unemployment and slumping commodity prices. Several economists predicted that recovery might not appear until 2011 and that the recession would be the worst since the Great Depression of the 1930s.