A common misconception is that if everybody was prepared to take awful enough jobs, unemployment would be eradicated automatically, irrespective of the government's fiscal stance. Embedded in this argument is a misconception that unemployment, overall, can be eliminated through lower wages or deteriorating working conditions. In a capitalist monetary economy, this is not true. To think otherwise is to succumb to a fallacy of composition.
Orthodox neoclassical economists made this claim prior to the contributions of Keynes and Kalecki, but it was shown to be unfounded in the capital debates as well as in later work by neoclassical general equilibrium theorists themselves.
Even intuitively there is little reason to expect that an inverse relationship between wages and aggregate employment would hold. A reduction in the price of anything always means two things simultaneously. It means: (i) somebody has to pay less for something they want; and (ii) somebody else is receiving less for providing that thing. At the aggregate level, it means: (i) all of us, taken as a whole, are paying less for the stuff we want; and (ii) all of us, taken as a whole, are receiving less for providing the same stuff. Why would this have any systematic effect on how much stuff will be produced in the economy? It doesn't, as has been demonstrated formally in the Capital Debates and later work.
Unemployment is a government policy choice. Redistributing existing income from workers to capitalists by lowering wages has no systematic effect on aggregate employment. The lower wages mean workers are cheaper for firms to hire, but demand for consumption goods may be reduced. So is there more or less impetus for firms to undertake production of consumption goods? Is there more or less impetus for firms to undertake production of investment goods that will increase the capacity to produce consumption goods in the future? The answer to these questions is indeterminate. A mere redistribution of income (from wages to profits or vice versa) has no systematic effect on output and employment.
The bottom line is there are not enough jobs. One person may be able to get an existing job ahead of somebody else by offering to work for less pay or under worse conditions, but this does not alter the aggregate level of employment and unemployment in a predictable way. It may cause employment to increase. Then again, it might cause it to decrease. For instance, redistributing income to capitalists may merely raise the intended level of net private saving and reduce the level of planned private expenditures. If so, there will be a multiplied contraction in output and income, defeating the private-sector attempt to increase its net saving unless – and to the extent that – the government allows its budget to move sufficiently into deficit to satisfy private-sector net saving desires.
Unemployment is the result of the non-government sector wishing to net save more than is consistent with full employment, given the government's deficit. The government has the capacity to eliminate unemployment, because its deficit expenditure adds to the non-government's net financial assets, enabling net saving plans alongside higher output and employment. The non-government sector cannot alter the level of net financial assets on its own. It can redistribute existing net financial assets among its members, hoping that in some way – by sheer fluke – this will reduce private-sector net saving desires and boost demand, production and employment, but it can't of its own accord increase its net financial assets.
By injecting sufficient additional net financial assets into the system, the government can render the non-government sector's net saving behavior consistent with full employment. This was the central point in Parable of a Monetary Economy; i.e. that the government can net spend an amount just sufficient to satisfy non-government net saving desires alongside full employment. That is the straightforward solution to unemployment, and we can have it the moment the general community puts its collective foot down and insists on it.