eli5: Why is high unemployment rate bad and why are people who are employed still worried about this even though they have a job?

Question

eli5: Why is high unemployment rate bad and why are people who are employed still worried about this even though they have a job?

In: Economics

Answer 1

A high unemployment rate is bad for you if you are looking for a job because it means that there are more people to compete with for any job that you might want.

Conversely, a high unemployment rate is good for you if you are hiring people because it is easier to find good candidates.

Because a high unemployment rate makes it easier to hire new employees, it makes existing jobs less secure. This is one reason people who have jobs should be worried about rising unemployment.