Almost all work during most of the 19th century was done by hand or with horses, mules, or oxen since there was very little mechanization. The workweek during most of the 19th century was 60 hours. Unemployment at times was between one and two percent. The tight labor market was a factor in productivity gains by allowing workers to maintain or to increase their nominal wages during the secular deflation that caused real wages to rise at various times in the 19th century, especially in its final decades. 20th century
There were labor shortages during World War I. Ford Motor Co. doubled wages to reduce turnover. After 1925, unemployment gradually began to rise.The 1930s saw the Great Depression impact unemployment across the globe. In Germany and the United States, the unemployment rate reached about 25% in 1932.In some towns and cities in the northeast of England, unemployment reached as high as 70%; the national unemployment level peaked at more than 22% in 1932. Unemployment in Canada reached 27% at the depth of the Depression in 1933. In 1929, the U.S. unemployment rate averaged 3%. In the US, the Works Progress Administration (1935–43) was the largest make-work program. It hired men (and some women) off the relief roles ("dole") typically for unskilled labor.
The effect was particularly pronounced for those with vocational or secondary education.Costs of unemployment also vary depending on age. The young and the old are the two largest age groups currently experiencing unemployment. A 2007 study from Jacob and Kleinert found that young people (ages 18 to 24) who have fewer resources and limited work experiences are more likely to be unemployed. Other researchers have found that todays high school seniors place a lower value on work than those in the past, which is likely because they recognize the limited availability of jobs. At the other end of the age spectrum, studies have found that older individuals have more barriers than younger workers to employment, require stronger social networks to acquire work, and are also less likely to move from temporary to permanent positions. Additionally, some older people see age discrimination as the reason for them not getting hired. Social
An economy with high unemployment is not using all of the resources, specifically labour, available to it. Since it is operating below its production possibility frontier, it could have higher output if all of the workforce were usefully employed. However, there is a tradeoff between economic efficiency and unemployment: if all frictionally unemployed accepted the first job that they were offered, they would be likely to be operating at below their skill level, reducing the economys efficiency.During a long period of unemployment, workers can lose their skills, causing a loss of human capital.