Question

You or someone you know may have experienced unemployment at some point. Among the three types of unemployment - frictional, structural, and cyclical - which one best describes a situation where individuals are unable to find jobs due to a mismatch of skills in the labor market and a lack of available job opportunities?

A) Frictional unemployment due to the temporary period of job search and skill mismatch in the labor market.

B) Structural unemployment caused by changes in the economy and a mismatch between job requirements and available skills.

C) Cyclical unemployment resulting from fluctuations in the business cycle leading to a decline in overall economic activity and a decrease in job opportunities.

D) Seasonal unemployment due to the periodic nature of certain industries or jobs, resulting in temporary layoffs during off-peak seasons.

Answer 1

Structural unemployment occurs when there's a mismatch between workers' skills and the available jobs due to economic changes, such as technological advancements or shifts in industries, creating job openings that require different skill sets.

Option 'b' is the correct.

Step-by-step explanation:

When individuals are unable to find jobs due to a mismatch of skills in the labor market and a lack of available job opportunities, structural unemployment best describes this situation. Structural unemployment is a result of changes in the economy that create a disconnection between the skills that workers possess and the skills needed for available jobs.

This type of unemployment may be caused by technological changes such as automation, shifts in industries, or even educational mismatches.

For example, workers may be replaced by machines in industries like automotive manufacturing, creating structural unemployment because the jobs that are available require different skills than those that the workers have.

Additionally, if a company relocates its factories from one country to another, the jobs that are left behind may require different skills, thus the workers who are laid off will experience structural unemployment until they can update their skills or find new jobs that match their skill sets.