How To Fix The Economy

Economic activity lives in the limelight as entrepreneurs start new businesses and create new jobs. Economic inactivity lives in the shadows as people struggle to find work and get jobs. To fix the economy, we need more of the former and less of the latter.

Economic inactivity

Economic inactivity is a term used to refer to people not active in the economy, as they are deemed to be neither in work nor actively looking for work.

Some types of economic inactivity have a positive effect as they include students, retirees and those staying at home to mind children or care for loved ones.

A high level of economic inactivity, however, has a negative effect and leads to lower productivity, lower employment, lower levels of engagement and higher levels of dependency.

Many attempts have been made over many years to address the issue but it remains a growing concern for government and policy makers.

A high level of economic inactivity causes untold damage to communities and those affected by its ills, not least because it fosters inequality and isolation.

The reasons for high levels of economic inactivity include low skill levels, a lack of appropriate and affordable childcare, separation from the help that’s already available and a lack of certainty and confidence about the future.

Within Northern Ireland, economic inactivity is relatively high when compared to other areas despite many attempts and much effort to reduce it.

To address the issue the European Commission has set a target to increase the European employment rate to 75% by 2020 with a Northern Ireland target of 70% by 2023.

Some solutions

There are practical ways to address the issue not least by increasing the number of jobs through employment, self-employment, entrepreneurship and the social economy.

There are also opportunities to create greater numbers of local jobs through the inclusion of social clauses in public contracts to encourage the employment of those who are inactive.

Small local businesses too can be encouraged to bid for public procurement contracts to generate higher levels of sales and, thus, the need to employ more people.

The social economy also provides opportunities to generate jobs, as voluntary and community groups provide services that lead to long-term sustainable social businesses.

Entrepreneurs too can play a role as they start new businesses and look for employees to help expand and grow their companies.

Creating jobs and opportunities at a local level helps to engage the disengaged, encourage the discouraged, include the excluded and fashion activity from inactivity.

Without reducing the number of people who are inactive, the gap between people in work and out of work will widen to impossible levels.

SO, economic activity dominates the headlines but reducing inactivity plays an equally important role in building the economy.