Global Journal of Human Social Science, E: Economics, Volume 21 Issue 4

Volume XXI Issue IV Version I 65 ( E ) Global Journal of Human Social Science - Year 2021 © 2021 Global Journals Which of these Economics Jargons - Underemployment, Overemployment, Unemployment, Rightemployment, Overqualification and Overeducation is Appropriate for an Economy? workforce's meagre finance. Also, it can be implied to mean a grossly lowered standard of living and insecurity. Usen (1978) stated that the unemployed eventually becomes psychologically wrecked. There are many more consequences of unemployment, such as housing, inadequate poor clothing, lack of medical care, deprived means of transportation and so on. All these sorrows would have been given a technical knockout had our leaders are awake to their responsibilities. g) Theories of Unemployment The theoretical framework in this research uses the Keynesian theory of unemployment; because it is more relevant to the Nigerian situation as GDP depends on unemployment, government expenditure and money supply (MS). Keynesian Economists see unemployment as a situation in which the number of people able and are willing to work at the prevailing wage rate exceeds the number of jobs available, and at the same time, firms are unable to sell all the goods they would like to sell (bannock et al., 1998). When carefully analysed, Keynesian unemployment primarily applies to situations in Nigeria (Bello 2003). Unemployment can result in a situation wheremany Nigerian consumers, including the government, prefer foreign goods to domestic goods, thereby causing the domestic producers to be faced with low demand problems that naturally forces them to lower output and reduces workforce. This experience continues in some firms, especially the small-scale ones, till they are pushed out of the market resulting in the loss of more jobs, the long- term unemployment remains in the market for too long and thereby reducing the costs of job finding. Keynes believed that government interference is beneficial to an economy. Through fiscal and monetary policies, the government use spending on goods or services to regulate the business cycle. Government’s spending decreases the price of goods and services, making them cheaper, and spurs increased demand and consumer spending. Unemployment is a monster that plagues Nigeria, and it is one of the most critical problems the country is to tackle. The years of corruption, civil war, military rule, and mismanagement have further exasperated economic growth in Nigeria. Nigeria is endowed with diverse and infinite resources, both human and material. However, years of negligence and poor government policies have led to the underutilisation of these resources. According to Olueye (2006), the classical economist argued that unemployment exists when unions maintain wages above their equilibrium level. When this happens, we have a situation of involuntary unemployment. Cyclical unemployment differs from structural and frictional unemployment (lindbeeket et al., 1999). It is unemployment that results from a lack of aggregate demand in a downswing in the business cycle (Bannock et al., 1998). In his theory of unemployment, Pigou (1934) makes the employment volume depend on the actual wages and the natural demand function for labour. These two fundamental factors interplay in the market to determine equilibrium employment, assuming there is no involuntary unemployment. As noted by Keynes (1936), changes in the investment rate can shift the employment volume; thus, a change in unemployment. Involuntary unemployment is possible, as evidenced during the great depression. Against the popular view of orthodoxy (classical economics), Keynes showed that economies could go into a depression where the various production factors were not used to achieve optimum economic configurations. A. Classical Theory The views of most economists always go with their thinking at that particular time. The two top schools of economic thought were "classical and Keynesian." The two have different ideas on the effect of unemployment. The classical was the school of thought that emphasised money's role in explaining short-term national income changes. Traditionally, this theory has been looked upon in aggregate. Their view was that involuntary unemployment was a short-term phenomenon resulting from discrepancies between the price and wage levels. Unemployment was the result of too high real wages. At times the wage level in the classical view would be reduced, and there would be no unemployment except for frictional search unemployment caused by the time delay between quitting one job and starting another. This school professed that urban unemployment is traceable to workers' fault and the various trade union powers. They believed strongly in the theory of demand and supply. Therefore, it contends that urban unemployment is caused by a low labour supply of more than the economy's capacity. Accordingly, the school argued that the demand for too high wages of workers without a corresponding increase in productivity renders product costly, thereby discouraging competitiveness among local and foreign industries. This trend's implication is the decrease in sales, which further leads to mass retrenchment of workers culminating in unemployment. B. Keynesian Theory The British economist John Maynard Keynes's ideas of the 1930s reformed the intellectual thoughts of nations in several areas of macroeconomics problems of money supply, inflation, and unemployment, which he mentions in his publication “The general theory of unemployment, interest and money”. The Cyclical or Keynesian unemployment, is also known as demand deficient unemployment, occurs when there is no aggregate demand in the economy. It gets its name because it varies with the business cycle, though