Question

Unemployment that occurs because it takes workers and employees time to find each other is called:

a) Frictional unemployment.
b) Structural unemployment.
c) Cyclical unemployment.
d) Seasonal unemployment.

Answer 1

The correct answer to the student's question is a) Frictional unemployment.

Step-by-step explanation:

This type of unemployment occurs when there are time lags in the process of matching workers with job vacancies. In a market economy, companies may fail or succeed for various reasons, leading to job losses and openings. Frictional unemployment is not negative per se; it's a natural part of the job search process, allowing both employers and workers to find the best match for their needs.

The process can involve time for interviews, making decisions, or relocation. Unlike structural unemployment, which is due to a mismatch between the skills of job seekers and job requirements, or cyclical unemployment, which is related to economic downturns, frictional unemployment is about the normal time taken to find a new job.