EFFECT OF CURRENT WORLDWIDE RECESSION ON FUTURE UNEMPLOYMENT IN THE UNITED STATES
This research examines the effect of the current world-wide recession on the future of unemployment in the United States. A disclaimer needs to be made prior to beginning this analysis. That disclaimer is that no world-wide recession exists in the Spring of 1999. The situation that actually prevails is that many economies around the world are in recession, but many are not in recession. Further, there are areas of regional recession within the global economy (International Monetary Fund, 1999). A notable case in point is East Asia. Certainly, however, a sufficient proportion of the world's economies are current in recession to warrant an assessment of the potential of this situation to affect future employment levels in the United States. The economic problems being confronted by the economies of southeast Asia are especially serious and hold the potential to have an impact on future employment levels in the United States (Son, 1999).
Of all of the economies around the world that are in recession, the Japanese economy has the greatest potential to affect future employment in the United States in a negative way. The Japanese economy is in a state of near crisis in the Spring of 1999, with output falling, the financial sector in disarray, and the government unable to act decisively because of the ability of the political opposition to thwart government plans through its control of the upper house of the Diet. This situation, if not resolved, bodes ill not only for Japan, but also for the other economies of East Asia that depend heavily on Japanese economic leadership, and for the United States, as the Japanese government and Japanese investors hold in excess of US$500 billion in United States government debt, or one-third of United States government debt that is held by entities outside of the United States (Morgan & Pain, 1999).
Some peop...