Final answer:
According to historical economic data, in Canada, the unemployment rate is most likely to rise when there is sustained negative economic growth. Economic growth tends to lower unemployment rates, and cyclical unemployment correlates with economic cycles. The natural rate of unemployment persists even during strong economic periods.
Step-by-step explanation:
According to historical economic data for Canada from 1976 to 2012, the unemployment rate is most likely to rise when there is sustained negative economic growth. This scenario is supported by the concept of cyclical unemployment, which indicates that unemployment rises during periods of recession and depression. Although the U.S. data is referenced, the economic principle that unemployment rates, affected by economic downturns and recessions, tend to increase holds true broadly, including in Canada.
During periods of economic growth, unemployment rates are typically lower. There is also not necessarily a significant upward or downward trend in unemployment rates in response to factors like population growth, globalization, or new technological developments over the long term. This trend is reflective of the economy's ability to provide jobs consistently over time.
The concept of the natural rate of unemployment explains why unemployment never falls to zero, as it includes structural factors and frictional unemployment that persist even when the economy is strong and growing.