Unemployment that occurs during the contractionary phase of the business cycle is known as:

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Cyclical unemployment is the unemployment that occurs as a result of the contractionary phase of the business cycle. During this phase, economic activities slow down, leading to a decrease in job opportunities and an increase in lay-offs and unemployment. Frictional unemployment refers to unemployment that occurs due to people moving between jobs, while structural unemployment occurs as a result of a mismatch in skills and job requirements. Contractionary unemployment is not a commonly used term in economic literature.

Unemployment That Occurs During the Contractionary Phase of the Business