Question

Classify each of the following unemployment situations as either cyclical, frictional, or structural unemployment. Items (7 items) (Drag and drop into the appropriate area below) Paul lost his job six months ago His employment counselor at the labor office advises him to retrain. Unemployment in Michigan increased as consumer demand for automobiles fellanother job as a their jobs. during the Greatfinancial analyst. Recession. Michael is temporarily out of work. He quit his job at Citibank to find In 2011, BordersA data-entry Books filed for bankruptcy, andhis job because it 19,000 employees lost Mary graduated from college withconstruction an economics degree. She doesn't have a job yet, but she has six interviews lined up. Large numbers of employee loses was permanently outsourced to India. workers lost their jobs after the collapse of the housing bubble.

Answer 1

1. Paul lost his job six months ago - structural unemployment as there is a mismatch between the skills Paul has and what skills are needed by the employer.

2. Unemployment in Michigan increased due to the great recession - Cyclical unemployment due to business cycles. Unemployment increases during recession.

3. Michael is temporarity out of work - Frictional unemployment. Frictional unemployment occurs because people have voluntarily chosen to be unemployed.

4. In 2011, Borders Books filed for bankruptcy. Structural unemployment because job losses occured due to business failure. This could be due to increased competition, jobs moving overseas etc.

5. A data-entry operator lost his job. Structural unemployment because jobs moved overseas.

6. Mary graduated from college. Frictional unemployment as it takes time to find a new job.

7. Large number of construction workers lost their jobs - cyclical unemployment.