Name the type of unemployment occurring in each of the causes below and explain your answer.

(a) Frank recently lost his job as the computer manufacturing company he works for recently downsized after poor sales and poor performance of the economy during the last year.

(b) Julie just recently graduated from college; she is not working and is searching for a job that best suits her skills and qualifications.

(c) Tom recently lost his job as the steel manufacturing firm he worked for moved their plant overseas. The other steel plants in the nation have been also been following this trend.

(d) Susan recently left her marketing job at a local bank because she found that finance interests her more. She is currently looking for a job as a financial consultant.

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Business

Amari Anthony

Today, 04:26

Name the type of unemployment occurring in each of the causes below and explain your answer.

(a) Frank recently lost his job as the computer manufacturing company he works for recently downsized after poor sales and poor performance of the economy during the last year.

(b) Julie just recently graduated from college; she is not working and is searching for a job that best suits her skills and qualifications.

(c) Tom recently lost his job as the steel manufacturing firm he worked for moved their plant overseas. The other steel plants in the nation have been also been following this trend.

(d) Susan recently left her marketing job at a local bank because she found that finance interests her more. She is currently looking for a job as a financial consultant.

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Answers (1)

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Lucian · Answer 1

a) Cyclical unemployment

b) Frictional unemployment (Not currently in the labor force)

c) Structural unemployment

d) Frictional unemployment

Explanation:

a) When unemployment occurs due to the changes in the business cycle, unemployment refers to as cyclical - for instance, expansion to recession or recession to expansion. Since the company's profit is decreasing due to poor sales due to the economic recession, Frank has lost his job. In this case, due to the economic downturn, unemployment occurs. Therefore, we can say that it is cyclical unemployment.

b) When a person transforms between school and a job, that person is not in the labor force. However, this kind of state is known as frictional unemployment. Since Julie has just graduated, she does not lie in the workforce. However, since she is searching for a job, she lies in the frictional category of unemployment.

c) When the demand either shifts from the lack of skill or the employees do not have the extensive knowledge of that skill, the structural unemployment occurs. Since the steel manufacturing firm closed in the domestic market to move abroad, either he needs to move to the place the company sets up or finds a new job.

d) When the employees leave a job to move another job, that type of unemployment is called frictional unemployment. Frictional unemployment is not bad for an economy. Since Susan left her marketing job to grab an opportunity to get the finance job, he took a break from the job market. Therefore, there is a movement between the jobs. It is frictional unemployment.