Question

3. Types of unemployment The three people described in the following table are categorized as unemployed by the Bureau of Labor Statistics. Identily each person in the table as structurally, frictionally, or cyclically unemployed. Unemployment Type Structural Frictional Cyclical Beth is a real estate agent House sales in her area have declined because the region has been going through a recession. She has no clients and is currently looking for a new full-time job. 0 0 0 Sam left his job as a plumber when his wife took a position in another region. The quantity of plumbing services demanded is considerably lower in the new region, in part because of high union negotiated wages. He would like to work at the high union wage but remains unemployed due to a lack of plumbing jobs. 0 0 0 Teresa is a physician who has decided to relocate to California to be closer to her family. She is currently interviewing with several prestigious hospitals in the San Francisco Bay Area.

Answer 1

Frictional unemployment occurs when workers are searching for new employment.

Frictional unemployment includes people who have left their jobs and are looking for new work, people who move to a different city, and people entering the workforce.

Cyclical unemployment occurs due to changes in economic cycles. For example, when unemployment rises because of a recessionary period it is known as cyclical unemployment.

Structural unemployment occurs because of technological advances or decline in an industry.

Beth cannot work as a real estate agent because there is a recession in her area.

This is an example of CYCLICAL UNEMPLOYMENT.

Sam has left his job as a plumber, and is looking for a plumbing job

in a new region. This is an example of FRICTIONAL UNEMPLOYMENT.

Teresa is looking for work because she has relocated to California.

This is an example of FRICTIONAL UNEMPLOYMENT.