Analyse the impact that the increasing number of social grants may have on the unemployment rate ​

Answer with Explanation:

"Social grants" are supports coming from the state which aids people who are having a hard time providing themselves.

The increasing the number of social grants will enable many people to access greater support, especially those who are poor, old, unemployed and have many children.

On the contrary, an increasing number of social grants will result to a higher dependence of unemployed people. People will also feel more entitled to have access the social grants than before, thus making them more lazy in striving to work.

One example of this is South Africa. The higher the number of families who receive the grants, particularly in rural areas, the lower the number of people who join the low-level farming livelihoods. This means that social grants increases the "reservation wage" of low-income families, thus they become less motivated to earn. This results to a higher unemployment rate.