To truly understand the impact population has on employment/unemployment statistics, we have to first realize that as the population grows, so does the amount of entrepreneurs who are on a mission to build successful businesses. Similar to this belief, the amount of unemployed individuals also grows along with the population growth rate (PGR) of a geographic region. PGR ordinarily refers to the change in population over a unit time period, often expressed as a percentage of the number of individuals in the population at the beginning of that period. Worldwide, the growth rate of the human population has been declining since peaking in 1962/1963 at 2.20% per annum or 88 million. In 2009, the estimated annual growth rate was 1.1%. As this fluctuates from year to year, it still continues to steadily increase over time. Therefore, going by these statistics paired with the unemployment rate data collected over the past few generations, it is safe to assume that as the population grows, so will the number of jobs and the number of unemployed individuals.
For the sake of keeping this concept simple to grasp, let’s hypothetically say that in the beginning of time there were 100 people on the earth living in a small community. One of them decides to provide a service of chopping firewood for other families in exchange for baked bread. As the demand for his service picks up, this ancient entrepreneur (we will call him Atticus) eventually has to ask 10 of his villagers to help him and in exchange he will pay them each a loaf of bread for a day’s work. One of the other villagers is an old lady (we will call her Gretchen) whose bread is renowned for its great taste, so Atticus suggests to Gretchen one day, while chopping her firewood, that she should start offering her bread to other villagers in exchange for something in return. Gretchen takes Atticus’ advice and her bread baking business quickly takes off so she hires 20 people to help take on the workload. Over time, people throughout the village discover they can offer their own goods and services in exchange for other goods and services, then eventually develop a monetary system as the businesses and workforces grow. However, there are still a few people throughout the village who remain unemployed for various reasons. As the population of the village grows over the next few generations, so do the number of businesses and employed/unemployed individuals. In theory, going by the statistics we have available today, it is a likely scenario that as the population grows, so do the number of employed and unemployed people – thus the statistics will always change.
This concept can be looked at from both a negative and positive aspect, but I would rather look at this optimistically. I believe that as long as a person is motivated to learn a new skill or trade, they will have a greater chance of succeeding. Even if the economy collapses and resets itself, there will always be a need for goods and services which will create commerce. As the population grows, so does the demand for commerce and more opportunities arise. Unemployment will always exist no matter what, but as the number of people change, so do the employment rates. Therefore, we really shouldn’t fear unemployment or become discouraged when these rates go up. Instead, we should keep in mind that more and more college graduates are entering the workforce, people are starting new businesses, and more people are willing to work as the population grows. The mainstream media tends to scare people in order to inflate their ratings sometimes, and we should be aware that they also control what you hear even when it may not always be the complete truth.
The point of this article is to offer a different perspective on the fluctuating unemployment rates both in the past and the future to come. Instead of looking at unemployment negatively, maybe we should realize that as those numbers increase – the growing population might be to blame, and to the contrary, employment may also be rising along with it.