Unemployment is higher than the natural or target rate in many countries, including the US.

Demand for Labor
When businesses need to expand, they go to labor markets for additional employees.
Workforce Competitiveness
If the work can be done for cheaper & better here compared to somewhere else, business will hire here.
Workforce Productivity
Amount of value created per hour. It depends on available automation, worker skills, work ethics, etc.
Cost of Labor
Cost of labor per hour. It depends on minimum wage requirements, cost of living, labor contracts, etc.
Workforce Skill Mismatch
If there is a skill mismatch between the business needs & available work force skills, workers cannot be hired.
Supply of Labor
If more workers are available (e.g., due to population growth, change in demographics, etc.), unemployment will increase.

Economic Activity

GDP is a measure of economic activity inside a country - the sum of goods & services produced.

Private Consumption
If people are unemployed, they are less likely to buy goods and services.
Interest Rates
If interest rates are low, people are more likely to borrow and spend.
Current Debt Levels
If people already have lots of debt, they cannot or do not like to borrow more and spend.
Government Consumption
Government spending (fiscal policy) increases consumption of goods and services in the economy.
When entrepreneurs solve society's problems through innovation, economic activity is stimulated.
Capital Availability
Business require capital to buy machinery and equipment to produce goods and services.
Labor Availability
Businesses need people to produce goods & services. This is not a constraint if unemployment is high.
Monetary Policy
Central banks control interest rates and money supply.
Government Debt & Deficits
If public debt & deficits are already high, there will be resistance to increasing government spending.
Country Competitiveness
Business will move to countries that provide stability, rule of law, respect for private property, good infrastructure, and low cost of doing business.
Net Exports
If a country exports more than it exports, economic activity inside the country increases.
Business investments (equipment & tooling) that produce goods & services.


Harvard Business School on US Competitiveness

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