How does technology affect the unemployment rate?
Answer (2)
Introduction of new technology has a direct impact on the unemployment rate in an economy. We can say they have an inverse relationship with each other. Say, a new machine is introduced in a manufacturing industry which can produce a given product in lesser time than the time a worker would take to produce. In such cases, machine will replace man power and thus unemployment would increase.
Technology impacts unemployment by automating tasks, leading to structural unemployment of lower-skilled workers, while simultaneously creating new job opportunities for skilled labor. Education and retraining are crucial for workers to adapt to these changes. Over time, technological advancements can contribute to economic growth and reduce unemployment rates.
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