Types of unemployment

Types of Unemployment refers to the various categories of unemployment that occur in an economy. Unemployment, in general, is a situation where individuals who are capable of working and are actively seeking work are unable to find employment. The different types of unemployment include structural, frictional, cyclical, and seasonal unemployment.

Structural Unemployment

Structural Unemployment is a form of unemployment caused by a mismatch between the skills that workers in the economy can offer, and the skills demanded by employers. This type of unemployment is often brought about by technological changes that make the job skills of many workers obsolete.

Frictional Unemployment

Frictional Unemployment is short-term unemployment that occurs when people are between jobs, have left their job to find a better one, or are looking for their first job. It is the time period between jobs when a worker is searching for, or transitioning from one job to another.

Cyclical Unemployment

Cyclical Unemployment is a type of unemployment that occurs when there is not enough aggregate demand in the economy to provide jobs for everyone who wants to work. In other words, cyclical unemployment is caused by changes in the business cycle.

Seasonal Unemployment

Seasonal Unemployment occurs when people are unemployed at certain times of the year, because they work in industries where they are not needed all year round. Examples include the construction industry in cold climates and the agricultural industry.

See Also

• Unemployment
• Economic Cycle
• Job Market