Question

Anne-Marie is a graphic designer for a local advertising agency. In each of the following situations, explain what type of unemployment Anne-Marie would be experiencing. a. Anne-Marie just completed her Bachelors degree in Graphic Art and is actively applying and interviewing for positions within her field. b. Ad agencies are finding that skilled graphic designers in India are able to work cheaper and faster than locally hired graphic artists in the US. The advertising agency where Anne-Marie works fires her and sends the work to India. c. The local economy is experiencing a recession and the advertising agencies don't have need for many graphic artists so they lay Anne- Marie off. The owner assures her that she will be rehired when business picks up again. HTML Editore XX, BIVA-A- IE3 - 2 Vo v leto 1 12pt MacBook Pro

Answer 1

a) Frictional Unemployment: It refers to those type of unemployment where workers voluntarily resign in search of better jobs. It also includes students are looking for job for the first time after their completion of studies.

b) Frictional Unemployment : It also includes unemployment due to firing of employees for business specific matters. Here, ad agency fired Anne because of cheaply available labourers in India.

c) Cyclical Unemployment: This type of unemployment refers to unemployment caused due to contraction of the economy. When economy is facing recession, it lays out its labourers inorder to reduce its cost.