If the economy enters a recession,

Question

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During a recession, companies may experience a decline in demand for their products or services, which can lead to a decrease in production and layoff of workers. This results in an increase in cyclical unemployment, which is unemployment caused by changes in the business cycle. Structural unemployment, which is caused by a mismatch between the skills of the workforce and the skills demanded by employers, may decrease during a recession as there are likely to be fewer job openings available. Frictional unemployment, which is caused by workers moving between jobs, may increase as workers are less likely to find new job opportunities during a recession. The number of workers on layoff may increase during a recession, not decrease.

If the Economy Enters a Recession