Answer to Question #315405 in Microeconomics for Jennifer

Question

Examine the major types of unemployment and the need for such categorization???

Answer 1

Cyclical Unemployment-It's the part of overall unemployment that's caused by economic ups and downs. During recessions, unemployment tends to grow, but during expansions, it tends to fall.

Frictional Unemployment-It's a sort of unemployment that occurs while people are looking for new jobs or switching jobs. It is a natural feature of unemployment and hence exists even when the economy is at full employment.

Structural Unemployment-It is an involuntary form of unemployment created by a mismatch between the skills that employees in the economy can offer and the skills that employers demand of workers. Structural unemployment is frequently caused by technical advances that render many workers' job skills outdated

Seasonal Unemployment-It happens when people are unemployed at times of the year when labor demand is lower than usual. Seasonal unemployment is defined as a period of time during which the quantity of available job possibilities diminishes.

Unemployment categorization is needed because,for a variety of reasons, unemployment is an important macroeconomic statistic. The level of unemployment reflects the health of our economy. Unemployment implies we aren't making the best use of our workforce, which means we aren't generating as much as we could. Unemployment has a personal cost as well.