[MrFoof]

I think the issue is the pronounced effect of market disruption.

In your example, if an industry is disrupted to where it now employs 100K instead of 1M people, the problem that arises for the short term is up to 900K people will be without employment for some duration. Eventually new jobs will be created and we'll be back to relative equilibrium, but that takes time.

In an ideal situation, these dips could be more quickly counteracted, but realistically the market isn't so efficient in which that would ever be possible, so other systems need to exist to support individuals until the market reaches equilibrium again.