Rates of both unemployment and poor mental health have increased during the pandemic. Unemployment is expected to rise further throughout this year, peaking when furloughing ends. Deteriorating mental health has been partly due to the social impact of pandemic restrictions, but as our analysis has previously shown, it is also related to economic uncertainty, job loss and unemployment. With the economic consequences yet to be fully felt, a further deterioration in mental health for those bearing the brunt is likely.
The impact of the pandemic on employment has been difficult to assess, because traditional employment measures do not adequately capture pandemic activity such as the temporary shutdown of some sectors and the move to reduced hours or none at all due to the furlough scheme.
Despite these initiatives, the unemployment rate rose from 3. With pandemic support schemes set to end this autumn, a further rise in unemployment is expected. Our independent analysis in this section largely makes use of a survey designed by the Resolution Foundation, funded by the Health Foundation, and conducted by YouGov between 22—26 January see full details at the end of this long read. It has a sample size of 6, adults aged 18— Results are weighted to be representative of the population of that age group.
Before the pandemic, some groups — such as younger people and those from minority ethnic groups — were more likely to be unemployed. These groups have also been hardest hit by the effect of pandemic restrictions through either unemployment, loss of work or reduced pay.
Figure 1 highlights this pattern, showing the reported unemployment rate for the working age population those aged 18—64 in January by different characteristics. Younger people, men, people from minority ethnic groups and lower skilled workers were all more likely to be unemployed than other parts of the population.
Prior to the pandemic, while the unemployment rate was lower, the relative likelihood of unemployment for different groups was similar. Figure 1 provides some indication of the likely pattern of unemployment to come, but there are other important economic consequences to consider. For instance, while mothers are less likely to be unemployed, IFS research has shown that mothers have on average reduced their working hours relative to fathers during the pandemic.
This is likely to leave mothers at greater risk than fathers of having lower earnings in future, even if they remain employed. The labour market impact on disabled people has been captured in more detail by researchers from Sheffield University funded by the Health Foundation. Workers with mental health problems are also more likely to work in sectors that have had to close, making them vulnerable to job losses and potentially widening this employment gap.
The pattern of increases in unemployment also varies significantly by geographical area, partly reflecting the employment sector mix, insecurity of work and differences in how local restrictions have been applied over time. Figure 2 shows the change in unemployment benefit receipt the unemployment claimant count as a share of the working age population between February and November , compared with the existing concentrations of unemployment benefit receipt prior to the pandemic.
Local areas with higher concentrations of unemployment benefit receipt prior to the pandemic are more likely to have experienced greater increases in the share of population in receipt. These areas are typically more likely to be deprived, and to be in the north of England or to be coastal towns. The experience of the previous decade shows that despite a period of sustained employment growth, inequalities in employment outcomes persisted.
Once pandemic support measures end, the same inequalities are likely to be reinforced. Policy can play an important role in shaping the recovery to reduce these differences in unemployment while also improving mental health. However, the traditional policy response of benefits and employment schemes to address unemployment fail to provide specific support with mental health problems.
The only influence such schemes have on mental health is indirect — through the health benefits that can be accrued by being in work. Rates of poor mental health increased during the first lockdown, and although depression and anxiety levels improved as the initial restrictions eased, they began to decline towards the end of summer and have been worsening since.
The economic situation is one but not the only factor in heightened levels of poor mental health. This suggests that, as found previously, furloughing appears to offer some protection against mental health decline.
The incidence of poor mental health also varies by population group. Figure 4 shows the highest risk groups: women, mothers and people younger than Previous waves — such as April and November — showed that the age group with the highest share of people with poor mental health was people younger than This change in pattern appears to be driven by the high prevalence of poor mental health of mothers shown in this wave.
Such analysis and an understanding of the mental health needs of different groups is important for policy design. Having schemes that support individuals into employment is crucial, but so is ensuring those schemes also provide mental health support that is targeted to at-risk groups such as younger people and women.
One economic reason to ensure employment policy supports better mental health is the potential cost implications for wider health services, particularly mental health services. Upstream action and investment in mental health can prevent further financial and capacity burdens on already overstretched services. In the UK, GPs are usually the first port of call for accessing mental health services. GPs then refer patients onwards to the most appropriate support.
In the past year, initially steering people towards self-led mental health services such as apps has become more commonplace. And some services do not require GP referral — people can self-refer for psychological therapy , for example. This estimate only accounts for changes to mental health observed up to autumn , including delayed referrals due to restrictions.
A further increase in poor mental health because of ongoing restrictions and economic issues in would add to this figure. The social security system and job support schemes currently fail to properly account for the needs of people with existing mental health problems. Indeed, they can exacerbate them and even create new ones. Without better design, pre-existing elements of these schemes risk worsening the experience of individuals who need support.
People with health conditions, including mental health conditions, which limit their ability to work can also claim an additional income support payment. The Budget has extended this uplift until October — so while much-needed income support will be provided for longer, many families face a sudden drop in income later in the year. The system coped well with the huge surge in social support claims during the first wave of the pandemic. This was for reasons such as possessing savings, or having a partner continuing to earn.
After losing their jobs, many individuals had to turn to food banks or borrow money. The Job Retention Scheme known as furloughing has provided a much-needed form of earnings replacement for over 11 million people. The scheme has been extended several times because of the ongoing pandemic and currently set to end in September Universal Credit is also designed to help people into work or to earn more, but there are strict conditions attached.
The standard expectation is to spend 35 hours a week seeking work for those with caring responsibilities or existing work commitments, the hours expected are reduced. However, experiences of benefit recipients suggest that the circumstances of people with mental health problems often fail to be duly considered in setting these expectations.
During the first wave of the pandemic, the suspension of job seeking conditions for all UC claimants helped to mitigate the stress of searching for work, particularly when many sectors were closed. This blanket suspension has now ended, with work coaches instead applying discretion based on individual and local circumstances. It is important that this discretion takes into account mental health needs as much as caring responsibilities. In addition to effects on the individual and societal levels, unemployment also directly impacts the economy as a whole.
According to the U. Bureau of Labor Statistics, when people are unemployed, they spend less money, which ultimately contributes to less contribution to the economy in relation to services or goods sold and produced. Unemployed persons also experience a reduced purchasing power which can leave other individuals who create products that were purchased by these individuals without jobs as well.
Unemployed individuals consume much less than those who are employed, so a higher unemployment rate can leave the economy lacking in terms of products sold. This can leave organizations with decreased revenue.
While unemployment is a life stressor, there are several things you can do to decrease the negative impact this situation can have on you and your family. The following are a few tips to help you better cope with unemployment:. Being unemployed is a stressful situation that can cause many negative emotions to arise. While it may be tempting to avoid these feelings with unhealthy behaviors, dealing with them head-on is much more effective and healthy. Allow yourself time to adjust to being unemployed, don't beat yourself up for your situation and look for the positive side whenever possible.
Speaking with a counselor can also help alleviate some of the stress associated with unemployment. Rather than looking at unemployment as a permanent thing, try to see this situation as simply a setback that is temporary. This will give you the confidence and motivation to find a new job more quickly than if you view your unemployment in only a negative light.
Unemployed individuals often feel a sense of shame or embarrassment about their situation which often leads to isolation from friends and family. However, staying connected is essential to maintain motivation to find a new job and to promote a healthy mental and physical wellbeing. There are several available resources that give you the opportunity to network with professionals in the industry or field you're interested in.
Making connections with professionals often leads to learning about new job opportunities and can even result in a job recommendation. Unemployment often causes individuals to lose sight of their emotional, mental and physical wellbeing. However, taking care of yourself is essential in both the short and long-term and will ensure you're capable of taking a new job when the opportunity arises.
Get enough exercise and sleep and eat well to maintain your levels of positivity and energy. Find jobs. Company reviews. Find salaries. Upload your resume. Sign in. Career Development. What is considered unemployment? Last week, did you perform work for pay? Develop and improve products. List of Partners vendors. The national unemployment rate is defined as the percentage of unemployed workers in the total labor force.
It is widely recognized as a key indicator of the performance of a country's labor market. As a closely watched economic indicator, the unemployment rate attracts a lot of media attention, especially during recessions and challenging economic times. This is because the unemployment rate doesn't just impact those individuals who are jobless—the level and persistence of the factors of unemployment have wide-ranging impacts across the broader economy.
According to the U. Bureau of Labor Statistics BLS , when workers are unemployed, their families lose wages, and the nation as a whole loses their contribution to the economy in terms of the goods or services that could have been produced. Unemployed workers also lose their purchasing power , which can lead to unemployment for other workers, creating a cascading effect that ripples through the economy.
In this way, unemployment even impacts those who are still employed. When companies are trying to cut costs, they often reduce their workforce as one of their cost-saving measures. Those workers who are left to do more work after a company lays off part of their staff are not likely to receive any additional compensation for the extra hours they are working.
Unemployment can also have a negative effect on the mental state of those who are still employed. They may become more concerned about losing their jobs or be hesitant to search for other employment because they have a false belief that they "are lucky" to be employed at all. They may even feel guilty about having a job when their co-workers are out of work. More broadly, high unemployment is also problematic for the U. Unemployed workers consume far less than those with a steady income because they have less discretionary income.
In order to understand the causes and the remedy for high levels of unemployment, policymakers seek information on different aspects of unemployment. Statistics about the number of unemployed people, the period for which they have been unemployed, their skill levels, the trend in unemployment, and regional disparities in unemployment are periodically made available for policymakers so that they can interpret them and hopefully make better-informed decisions about steering the economy and countering unemployment.
One misconception about the unemployment rate is that it is derived from the number of people filing claims for unemployment insurance UI benefits. But the number of UI claimants does not provide accurate information on the extent of unemployment. This is because people may still be jobless after their benefits run out, while other applicants for UI benefits may not be eligible for benefits or may not even have applied for them.
Tracking every unemployed person monthly would also be very expensive, time-consuming, and impractical. Therefore, the U. The U. About 60, households, or approximately , individuals, are in the CPS sample survey, selected to be representative of the entire U. A typical household included in the sample survey is interviewed monthly for four consecutive months and then again for the same four calendar months a year later. The survey is carried out by trained and experienced Census Bureau employees.
They interview persons in the 60, sample households for information on both the labor force activities or non-labor force status of all of their household members during the survey reference period generally the week that includes the twelfth of the month.
When a sample survey is used, there is a chance that the sample estimates may differ from the actual population values. The basic definitions used by the BLS in compiling labor statistics are quite straightforward:.
The sum of employed and unemployed people makes up the labor force. The remainder consists of people who have no jobs and are not looking for any.
These typically include students, retirees, and homemakers. It's important to note that labor force measures, such as the unemployment rate, are based on the civilian non-institutional U.
Labor force measures exclude persons who are below age 16, people confined to institutions—such as nursing homes and prisons—and all personnel on active duty in the Armed Forces. While the basic tenets that determine whether or not an individual is employed are simple, there are numerous situations that can make it difficult to ascertain the correct category to which a person belongs.
People are considered employed if they did any work for pay or profit during the survey week. People are also counted as employed if they have a job at which they did not work during the survey week, for reasons such as being on vacation, falling ill, doing some personal work, etc.
People are classified as unemployed if they fulfill the following three criteria:. The official unemployment rate that is widely quoted in the media and other news sources in the U.
The criteria for being considered unemployed are rigorous and well-defined. For example, actively looking for work includes measures such as contacting prospective employers, attending job interviews, visiting an employment agency, sending out resumes, and responding to job advertisements.
Therefore, this excludes passive methods of job search, such as attending a training course or scanning the job advertisements in newspapers. As such, the total unemployment figure includes people who have lost their jobs, as well as persons who have left their jobs to look for other employment, temporary workers whose jobs have ended, individuals looking for their first jobs, and experienced workers returning to the labor force.
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