What Causes Technological Unemployment

Unemployment is a major concern for any society, as it has a direct impact on the economy and the lives of individuals. While the causes of unemployment are complex and varied, this article aims to shed light on some of the main structural causes of unemployment.

The Role of Technology

technology impact on employment

One of the most significant reasons for unemployment is the increasing uptake of technology in the workplace. From robots to automation software, technology is transforming the nature of work, and many jobs that were once performed by humans are now being replaced by machines.

For example, banks and other financial institutions have introduced automated systems to replace human operators. While these systems are often more efficient and accurate, they have resulted in significant job losses for many employees. Similarly, factories now rely heavily on machines to manufacture products, resulting in fewer jobs for humans.

The impact of technology on employment is likely to grow in the future, as advancements in artificial intelligence and machine learning continue to accelerate. While some experts argue that such advancements will create new job opportunities, others predict that they will lead to further job losses and increased unemployment.

The Impact of Globalization

impact of globalization on employment

Another structural cause of unemployment is the impact of globalization. As businesses become more globalized, they are able to access cheaper labor and goods from around the world. This results in job losses in developed countries, as businesses move their operations to countries with lower labor costs.

For example, many manufacturing jobs have been moved overseas to countries such as China, where labor costs are significantly lower than in developed countries. Similarly, customer service jobs are often outsourced to countries such as India, where wages are lower and workers can communicate in English.

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The impact of globalization on employment is complex and can have both positive and negative effects. While it can lead to job losses in developed countries, it can also create new job opportunities in developing countries.

The Role of Education and Skill Levels

The level of education and skills of the workforce also plays a significant role in unemployment. As the economy becomes more complex, the demand for highly skilled workers increases, and those with low levels of education or skills may find it difficult to find employment.

For example, highly skilled jobs in areas such as technology and engineering are in high demand, while low-skilled jobs in areas such as manufacturing and manual labor are becoming increasingly scarce. Workers with low levels of education and skills may find it difficult to compete for the few available jobs, resulting in higher levels of unemployment.

Improving the level of education and skills of the workforce can help to reduce unemployment, as it can ensure that individuals have the skills and knowledge required to secure employment in a rapidly changing economy.


In conclusion, unemployment is a complex issue that requires a multi-faceted approach to address. Structural causes such as technology, globalization, and skills mismatch all play a significant role in unemployment, and addressing these issues will require a combination of education and training programs, investment in innovation and technology, and policy changes at the national and international level.

It is important for governments, businesses, and individuals to work together to tackle unemployment and create a more equitable and prosperous society.

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