Unlike cyclical unemployment, both frictional and structural unemployment rise during recessions and fall during expansions.

Question

Quizplus · Accepted Answer

Frictional unemployment is associated with the time period people spend looking for a job and is not directly affected by economic cycles. Structural unemployment, caused by shifts in the economy that create a mismatch between the skills workers have and the skills needed by employers, can persist regardless of the economic cycle, although it might be exacerbated during recessions due to overall lower demand for labor. Cyclical unemployment, on the other hand, directly correlates with the health of the economy, increasing during recessions and decreasing during expansions.

Unlike Cyclical Unemployment, Both Frictional and Structural Unemployment Rise During