A term referring to individuals who are employable (who has the ability to get employed) and seeking a job but are unable to find a job.

Also, we can define it as, a class of people who are available for work but does not have an appropriate job.

Types of unemployment:

There are mainly 6 types of unemployment. They are:

• Cyclical unemployment.
• Structural unemployment.
• Regional unemployment.
• Classical unemployment.
• Seasonal unemployment.
• Frictional unemployment.
• Voluntary unemployment.

 

Cyclical employment:

• It is also said to be demand deficient unemployment.
• If the aggregate demand for the goods or services of the company is decreased, they cut their production and the workers are laid off.

 

Structural employment:

• Some market sectors decline because of long-term shifts in market conditions.
•  Due to this, there occurs a decline in the job potential of that particular sector.
• In many nations, globalization is an increasingly important cause of structural unemployment.

 

Regional unemployment:

• When structural unemployment affects local areas of an economy.
• It can be associated with the decline of certain industrial activities such as sugar production due to fewer production of sugarcane crop.

 

Classical unemployment:

• It is also said to be as real wage unemployment.
• If the actual wages are held above the market-clearing wage rate, this contributes to a surplus of the supplied labour which inturn causes classical unemployment.

 

Seasonal unemployment:

• When individuals are unemployed at specific times of the year, and for the rest of the time the demand for labour is lower than average.
• Labourers migrating to Punjab faces seasonal unemployment because they get work for only 3 months during the cutting of crops.

 

 Frictional unemployment

• Such type of unemployment causes when the time lag between a worker moving from one job to the next.
• When some employee is either fired from the company or quitted for personal reasons have much difficulty to manage their meantime.

 

Voluntary unemployment:

• If a worker wishes to quit a job because it is not financially rewarding anymore.
• A worker whose take-home pay is less than his or her cost of living is an example.