Definition of unemployment
There are two definitions of unemployment: One is the Strict definition of unemployment and the other is the Expanded definition. Distinguishing the two it is said when calculating the unemployment rate using the strict definition discouraged job seekers are not computed while utilizing the expanded definition anyone of a working-age (between 16 - 65, depending on the laws governing your state), able and willing to work yet is without a job, disregarding they are marketing for employment whether or not.
Generally people define unemployment as being without work, yet anyone can be without a job, but does that make them unemployed? Initially they have to be recognized as part of the labor force, which in other description referring to the Economically Active Population (EAP). A 5 year old child without a job is not unemployed, neither a 75 year old, as they are excluded from the EAP.
Types of unemployment
Frictional
According to the Cambridge Dictionary Definition, frictional unemployment is caused by a worker (employee) moving from one job and struggling to find one afterwards. Consider the story of Mike (fictional character), After obtain his degree in Economics, Mike was summoned and employed by the University of TopClass (fictional institution) to become lecturer because of his outstanding academic record exhibiting great understanding of the subject . After 4 years Mike submits a resignation letter to the institution with a goal of getting employed elsewhere to become an authentic Economist. He leaves his job and goes to market for a job and he ends up on the search for Economist job post for a year. This is a good example of frictional unemployment. Finding a job is not as easy as it seems, regardless you obtain a degree and a pleasing academic record. However frictional unemployment is not necessarily an issue because as people leave jobs for other ones, other people enter accounting for the size of the labour force.
Cyclical
Remember the business cycles? Referring to the fluctuations of economic activities? If you do it will surely come in handy. This type of unemployment is caused a by a recession where there is a severe contraction of economic activities. During recession, spending on goods and services had deteriorated, hence many people are being retrenched from their jobs because businesses and companies are trying to reduce their inventories.
Seasonal
Seasonal unemployment is associated with agriculture because for instance there is a time that to plant tomatoes. For a particular season that is suitable to plant tomatoes more farm workers will be employed, then at the end that season many will be without a job. Typical examples are, help is required in retail stores during holidays acknowledging people are preparing for family gatherings and will purchase a lot more.
Structural unemployment
Structural unemployment is a bit tricky because it has a lot of details. On this paper the focus is on changes in technology, for in great detail visit structural unemployment.
In the short-run, labour is projected to be the most variable input while capital is fixed, hence in the short-run businesses are labour intensive. In long-run, however, where all the inputs are variables businesses become more capital intensive, leading to more people unemployed.
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