How has the unemployment rate of the United States impacted the business cycle

High Unemployment Rate and the Business Cycle
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High Unemployment Rate and the Business Cycle
The unemployment rate in the United States has affected the business cycle in several ways. High unemployment rates among the consumers translate to low purchasing power and reduced sales volumes. The profits earned by the sellers also reduce significantly. As such, the suppliers inflate the prices of the goods and services offered. That is because of the reduced demand for the products and services. Sellers and providers employ this tactic to ensure that the sales match their financial goals.
Studies conducted by researchers in the field of business and economics reveal that recessions hit economies after a duration of ten years in average. The period is characterized by an increase in the unemployment rates, increased cost goods and services, as well as a sharp dive in the housing market. These occurrences result in increased crime rate, high depression rates, and political unrest. The number of investments also decreases significantly as some organizations and financial institutions are become bankrupt. Bankruptcy is an indicator that the available capital does not meet the existing economic demands.
However, once the economy is at its lowest point, it starts slowly begin to build back up again. According to the Labor Force Statistics from the Current Population Survey, unemployment in the United States of America was at its highest between 2009 and 2011.

The situation is better than before because there are signs of economic rebuilt and reduction in the unemployment rates. Researchers and financial analysts and auditors argue that the economy of the US will be back to its usual routine by 2019. That is to show that the overall economy unemployment and productivity should stabilize in approximately four years.
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Running head: HIGH UNEMPLOYMENT RATE AND THE BUSINESS CYCLE 1