The United States is amongst the global states which are embracing low rates of unemployment. Except for the Latin America which is fiercely allied to high informal employment the rest of the American continent is having a low unemployment rate which goes as low as 3% compared to 55-60% for most Asian and African countries. Broadly, the effects of law rate of unemployment in the US can be allied to the interaction phenomena in both the macroeconomic and microeconomic structures which have acted to influence the broad array of the economic growth.
The state of the economy is stable with few challenges into the inhibitors of poor states of economy. Over decade of years, US have enjoyed the superiority context into a stable state of the economy with elsewhere high purchasing power of the American dollar. Across the global imagery, it has enjoyed various economic benefits and economic integrations of its stable state of economy and strong purchasing power of its currency.
High state of economic activity have been the launching pad and the benchmark into high capital inflows from other states through foreign investment in America and the economies allied to favorable balance of payments enjoyed by the America. From the favorability in the economic structures, America has continued to embrace the economic structures of a macroeconomic capacity which provide instruments for high rates of employment. For states within the Latin American region, the high rate of informal employment is much functional and beneficiary with even better wages than most formal employments in the developing countries.
Broadly, the high rate of employment/low rate of unemployment in American can summarily be explained by the operation interlinkage between various macroeconomic and microeconomic structures. However, the great deal behind this situation can be credited to the macroeconomic variables which are captured in the broad economic equation. Elsewhere, the fiscal and monitory variables in the functional outlay of the American system provides an adequate pursuit for moral sense of high rates of employment. (Riggs, 2004)
At one level, microeconomic variables lobby in to define the factors at an individual level which influence and determine the state of employment. This is mostly credited to the reciprocating factors in the relationship between household income and the levels of consumption and savings. Generally, the economic model of personal income is described as a function of consumption and saving. The relative changes to one another gives the respective marginal propensities (to consume and save). The two are reciprocals of one another where a decrease in one will increase the other.
However, within America, the individual population has high marginal propensity to save due to the high income obtained from the formal employment and informal cases. With high saving ratios, the population is able to finance investment cost for new investment structure. The general investment portfolio within the US is highly favorable and highly growing to shoulder in the relatively high employment requirements. High investment structures provide an adequate room with which the broader human population is able to be absorbed within the employment structures. (Riggs, 2004)
Macroeconomic influences provide a great refuge for creating employment opportunities. Such macroeconomic tools can be defined in terms of the economic environment to yield adequate economic conditions for a high rate of employment. Generally, the fiscal economic variable does a lot to provide adequate environment for ensuring high state of economic activity. Generally, the federal government has done a lot about its spending to the public. High government spending has been a benchmark in the foundations of high states of economic activity which does not compromise high employment rates.
Government spending has been of a diverse nature in which it has provided various insurance allowances to the unemployed above other social structures allied to the public population. Government spending has helped to increase the broad income supply within the public. High expenditure has been an instrument in to the provision of capital for investment by the people. Elsewhere, the federal government has been in the forefront in instituting various structures aimed at providing adequate environment in its investment in government investment.
Fiscal policy has also been promoted by various adequate systems in its taxing structure. Consequently, the taxing system has provided a comprehensive package of desirable rate of taxes which are less prone driving out investors from the economy due to losses through government taxation. Through adequate levels of taxes which include tax exemption and rebates for various persons within the economy, the people and investment bodies have embraced the value consequence allied to such law rates of taxes. (Riggs, 2004)
Within the America, the monitory policy does a lot in providing an adequate environment for high rates of employment and the reduction of various unemployment inequalities borne of the people. The strong sense of the monitory policy provides a structure with which capital inflow is available. Indeed, America is amongst the global states in which case capital inflow is subordinately of high scale and encompassing no monitory rigidities. Broadly, the American monitory policy can be described in terms of the state of money supply and the demand for American dollar.
However, the two sides (both the demand and the supply conditions) show a concrete rigidity in their equilibrium level. The state of money supply is equal to the relative demand which helps to provide an attractive state of equilibrium. With equilibrium in the money market, the American dollar has embraced a high state of purchasing power. Economically, such high purchasing power has been the backbone of facilitating high capital inflows within the states. High purchasing power has provided economic advantage in the international symmetry of economic integrations.
Through favorable conditions of economic integrations, America has embraced high capital inflows from its trading partners. (Riggs, 2004) Alternatively a positive challenge into the monitoring system has been a solid factor for the influence of a positive balance of payment. Economically, desirable conditions and states of the monetary marketing are discretionally importance factors in determining the state of employment. Every high employment is an in depended variable of the state of monitory policies.
Conceptually, stable monetary economy defines the stability in the economic integration and the parameters of balance of payments. A stable economy is discretionary important for providing structures aimed at improving the state of employment. For every essence of capital inflow within America, this has been a foundation aimed at improving the export level and decreasing the state of foreign imports. Every aspect of high exports than imports helps to improve the state of employment. To America, the low rates of unemployment are counter factors determined by the existing state of high export than imports.
Stability in the economic state and the purchasing power of the currency has helped to improve the state of capital inflow within America High capital investment from the foreign world which has helped to improve the existing state of employment states. Summarily, the low state of unemployment in America can be allied to the prevailing economic structures existing within the American economy. The same has favored the stable state of investment which has on the other hand helped to increase the rate of employment within the state.