If there is a high unemployment rate then the economic growth is low and when there is a low unemployment rate then the economic growth is high.
But sometimes that is not the case, if there is negative economic growth also known as recession, then there is a rise in unemployment because of these following situations:
- Less demand for goods, so the firm will produce less products thus needing low number of workers.
- The company is bankrupt.
- Firms are hesitant to hire workers because of the uncertainty and negative economic growth.