Types of Unemployment
Unemployment Rate Concepts

Civilian and Non-institutionalized Adult Population:
Everyone 16 years old or older and who is not 
In the military

In jail or prison

Living permanently in nursing homes

In other "institutions."

Employed: The number of adult civilians who are working and on a payroll
of some type.

Unemployed: The number of adult civilians who are not working but are
actively seeking work.

Labor Force: The total number of adult non-institutionalized civilians who
are either working and on a payroll OR are actively seeking work.
Labor Force = Employed + Unemployed
Structural Unemployment

The skills of workers do not match the skills needed by the
labor market

Many jobs may be available, but an unemployed worker is
unable to fill the vacancies for a variety of reasons

lack of skills required for the available jobs

the work previously done by a human resource is now done by a
machine

workers lack the ability to move to a labor market where their skills
are in demand

Seasonal unemployment

Categorized as a long-run unemployment
Cyclical Unemployment

Occurs when workers lose their jobs due to a
downturn in the economy

Viewed as short-run unemployment because it is
usually low during expansions and high during
contractions

During a contraction or recession phase of the
business cycle, firms reduce the number of
workers they employ to cut costs and reduce
production until demand rebounds.
Frictional Unemployment

Occurs when someone leaves their job in search
of another one
OR

Someone previously outside the labor force enters the
labor market in search of a job.

Frictional unemployment is long-run unemployment.
 There
are always people moving in between jobs and
entering the labor force
 Women
returning to the workforce after child birth
Types of Unemployment