Effects of Unemployment

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Effects of Unemployment

2011

4/28/2011

High Crime Rate Linked to Low Wages and Unemployment
Recent studies show that low wages and unemployment tend to make less educated people commit crimes. The study was done on data between 1979 and 1997, when comparing unemployment and crime rate we found much of the increase in crime happened during the time of falling wages and rising unemployment among men without college educations. While the government focuses on crime fighting initiatives as central to controlling crime, this study shows that we should consider in opening more jobs to keep crime rate low in these periods. The impact of labor markets should not be overlooked. We can fight crime, but it will still continue to happen, we should try to attack the problem from the bottom.

With the crisis that we have going on right now and desperate people trying to find jobs. There is definitely going to be an increase in crime because people are going to find other means in which to get money. Granted that there will always be crime, during hard times like this, crime tends to rise. Public officials can put more cops out in the street, be on their sentencing, and take other steps to reduce crime, but there is only so much that they can do. Unemployment has a profound impact on the crime rates. Professor Weinberg at OSU conducted the study with Eric Gould of Hebrew University and David Mustard of the University of Georgia. Their results appear in the current issue of The Review of Economics and Statistics. From 1979 to 1997, federal statistics show that wages for men with no college education fell by 20 percent. After the declines in 1993, the property and violent crime rates increased by 21 percent and 35 percent respectively during that period. Weinberg said the strongest finding in this new study is a link between falling wages and property crimes such as burglary. There was also a link between wages and violent crimes such as assault and robbery; these types of crimes are done to get money. Weinberg said, "The fact that murder and rape did not have much of a connection with wages and unemployment provides good evidence that many criminals are motivated by poor economic conditions to turn to crime." (Quote This!!) Researchers calculated that 20 percent fall in the wages of those people that did not have a college education over the entire period can account for a 10.8 percent increase in property crime and a 21.6 percent increase in violent crime. This shows that the wage declines are responsible for more than half of the increase in both violent crime and property damage. National crime rates started rising in 1979 and continued to rise until 1992, this is the same time when wages for less skilled men started falling and unemployment started growing. When the unemployment started decreasing from 1993 to 1997 crime rates, respectively, also declined. Weinberg and his colleagues did several analyses to examine the connection between wages, unemployment and crime between 1979 and 1997 for men without college educations. In one analysis, they looked at crime rates in 705 counties across the country - all counties with populations greater than 25,000 - and compared them with state wages and unemployment rates. The second analysis focused on statistics from 198 metropolitan areas as defined by the U.S. Census. The researchers took into account factors such as arrest rates and number of police that may have also influenced crime rates. Overall, wages had a larger effect on crime than did the unemployment rate, according to Weinberg. That's because the unemployment rate is cyclical and there is no strong long-term trend. Wages, however, fell steadily during most of the period studied. "Clearly, the long-term trend in wages was the dominant factor on crime during this period," he said. In a third analysis, the researchers examined data from the 1979 National Longitudinal Survey of Youth...
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