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  Types of Unemployment

Types/Causes of Unemployment

a) Cyclical Unemployment

This is caused by inadequate or deficiency in aggregate (total) demand in an economy to generate sufficient work for the total working population. It is a serious type of unemployment that affects nearly all industries and is associated with trade cycle.

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b) Structural Unemployment

It results from changes in a country’s industrial structure. It affects certain industries because of immobility of labour both geographically and occupationally.

c) Frictional Unemployment

This is a short-term form of unemployment as it occurs when people are temporarily out of work when they are in the process of changing their jobs.

d) Technologically

This occurs due to the changes in techniques of production, that is, the substitution of capital for labour.

e) Seasonal Unemployment

Seasonal unemployment may arise when unfavourable weather conditions prevent crop production or when an outbreak of disease greatly reduces the size of the harvest and hence reduces the requirement of workers.

f) Residual/Hard-core Unemployment

Some of the people will not even be skilled of holding permanent job by the virtue of some physical or the mental disability.

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