How The Economy Has Impacted Since The 2008 Economic Crisis

A Critical Literature Review Exploring how Unemployment in Europe has been Impacted Since the 2008 Economic Crisis 1. Introduction The fall of the global bank Lehman Brothers between 2007 and 2008 almost knocked out the world’s financial system. The worst recession in 80 years in which the economic world is still recovering from. Europe got caught by fiddling with the American real estate market leading to the worst recession seen since the post war great depression. The crisis stunned the world and unemployment was hit heavily with businesses failing to make profits without letting go of employee’s, particularly in the labour market. With Europe still not fully recovered almost a decade down the line it still sparks debate today on how†¦show more content†¦Ã¢â‚¬ËœThere are now almost 20 million unemployed in Europe and our over regulated jobs market is partly to blame. If half of all small businesses in the EU created just one more job we could half the number of employed overnight’ (Cave, 2006). Cave’s study reports a dim view on unemployment even before the economic crisis of 2008. There is evidence to suggest that cave is accurate in his work due to the date it was published and Cave has used statistics to support his view. Stockhammer (2007) backs up Cave’s research on unemployment in Europe before the economic crisis by studying unemployment in previous decades. ‘Since 1981, the unemployment rate in Europe has been greater than (or close to) 8 percent’. Stockhammer blames the inflexible labour market for the high rate of unemployment and believes wage moderation is the way to resolve the unemployment issue. ‘While not always stated explicitly, the view that wage moderation will help, or is indeed the only way to reduce employment in Europe is shared by the major policy institutions now’. Stockhammer is re-enforcing Cave’s research that unemployment has been problematic in Europe way before the 2008 crisis. Both Stockhammer and Cave’s studies report a negative view towards unemployment before 2008 and shows conclusive