One of the most underreported stories of the financial crisis was the steep increase in household debt that accompanied the housing bubble. As housing prices went up during the past decade, people felt richer than they actually were. As a result, household debt skyrocketed to almost 100 percent of GDP. At the height of the housing bubble, we were saving near 0 percent of our income.

But since the crash in 2008, Americans have been in a painful process of deleveraging the debt they accumulated. Now the savings rate floats between 4 percent and 6 percent.

Under normal circumstances, saving more is a good thing. It allows you to plan for future investments and pay off debt.

But in a slumped economy, reduced spending also takes away from demand, causing higher unemployment. Some economists have estimated this reduced spending equates to $1 trillion in absent demand. Therefore, household debt will probably be the largest negative factor affecting employment until Americans pay off the massive debt they accumulated in the last two decades.

Incredibly high productivity

We are the iPad generation. We pride ourselves by being able to do almost anything from a singular, wireless device. What we haven’t really thought about, though, is how such rapidly advanced and fast changing technology means for employment. A McKinsey Global Institute study found the Internet created 2.6 new jobs for every job it destroyed. But further advancements in technology during the last decade were efficiency driven, which had a negative effect on employment.

Productivity usually is a good thing, as we can get more done with less. But we haven’t quite figured out how to retrain workers quickly enough to move into fast changing industries, especially in the last decades. Which leads me to my next point.

Lack of skilled workers

Fact: Even as we have historically high unemployment, there are thousands of jobs that go unfilled every month. The reason? Many American workers don’t have the adequate level of skills for today’s new industries. It’s shocking but true. We have too many history majors (no offense) and not enough engineers to qualify for jobs in new industries. From a policy perspective, there have been two failures of leadership in recent years.

The first is that an increasing percentage of our budget is devoted to the elderly, which limits how much we spend on training young workers. The second problem is that our worker training programs, at least on the federal level, have lacked efficacy. Going forward, we’re going to have to figure out how to create effective public-private partnerships to get workers the exact skills employers are looking for.

Politics, everywhere

I write an 800-word editorial every two weeks to voice my frustration with public officials. Most of my criticism is focused on the hyperpartisanship in American politics. Although I will not give Washington, D.C., a break for its dysfunctional state, it’s worth pointing out that they are not the only public servants that have misbehaved lately.

The markets swing hundreds of points over single-day trading sessions because of the sovereign debt crisis that has rocked Europe. They are just as frustrated with Greek and Italian parliaments as they are with Congress. This is a problem because Europe’s economy is our largest customer for American goods and services.

Economic turmoil there affects American businesses, which makes employers very nervous for the future. So until policy makers across the globe give employers certainty of government spending, taxes and regulation, it will be very difficult for employers to expand their operations as they used to.

All four of these factors weigh on employers as they decide to stay on the sidelines or hire new workers. Hopefully, policymakers in the United States and around the world realize these trends and work to make effective public-private initiatives to help fix the unemployment picture.

Ameek Singh is a State News guest columnist and international relations and political theory and constitutional democracy senior. Reach him at sodhiame@msu.edu.