Frictional unemployment exists because
A) the quantity demanded of labor exceeds the quantity supplied at the equilibrium wage rate.
B) of fluctuations in economic activity.
C) technological changes make the skills of the workers incompatible with the skills used on the job.
D) it takes time for people seeking jobs and employers seeking workers to find each other.

Question

Quizplus · Accepted Answer

Frictional unemployment occurs when workers are in between jobs, either because they are just entering the labor market or because they have left their previous job and are searching for a new one. This type of unemployment is inevitable and natural in any economy, but it can be reduced through measures such as job training programs and improving communication between job seekers and employers. Therefore, the best option is D, as it reflects the fact that frictional unemployment exists because it takes time for people seeking jobs and employers seeking workers to find each other.

Frictional Unemployment Exists Because