Before the economic crises of the early 20th century, including the great depression, the economic system was not directly concerned about the level of labor employment. However after these crises it became apparent that the economic management of the economy was necessary to keep people employed. Macro economics came into being.

Classical economics made the assumption of full employment and in fact that was a tenable assumption to make till the later stages of the industrial revolution. Lower populations and the availability of natural opportunities to work in the vast and rapidly opening up territories all around the world allowed classical economics to make assumptions of full employment. Employment was a bye product of economic activities to maximize wealth and income; it was not an issue or a social or economic objective by itself. Population growth and greater structuring of society changed that; and labor employment became a major political and economic objective.

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