Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 8: Q 26 (page 214)

What is frictional unemployment? Give examples of frictional unemployment.

Short Answer

Expert verified

it is type of unemployment that occurs as when workers move between jobs and are unemployed for the time.

Step by step solution

01

Step 1. Introduction

Natural rate of employment is the unemployment rate when the economy is stable and growing strongly without any booming or recession.

02

Step 2. Frictional Unemployment

In market economy there are both type of companies doing bad [firing and laying offs] and good[ looking for more workers to hire] for various reasons. Process of leaving one job and finding or joining new job takes time.

As workers move between jobs, the unemployment created as a result is referred to as frictional unemployment.

03

Step 3. Examples

  • Students: When students complete education, they remain unemployed for a period in search of job.
  • Maternity: Many parents choose to leave their job for a short period of time yo raise their children. They remain unemployed during this period.
  • Career break: Workers may take a break from employment tospend some time doing activities like travelling, or pursuing a hobby.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

What forces create the natural rate of

unemployment for an economy?

Why is there unemployment in a labor market with flexible wages?

Assess whether the following would be counted as “unemployed” in the Current Employment Statistics survey.

a. A husband willingly stays home with children while his wife works.

b. A manufacturing worker whose factory just closed down.

c. A college student doing an unpaid summer internship.

d. A retiree.

e. Someone who has been out of work for two years but keeps looking for a job.

f. Someone who has been out of work for two months but isn’t looking for a job.

g. Someone who hates her present job and is actively looking for another one.

h. Someone who decides to take a part time job because she could not find a full time position.

When would you expect cyclical unemployment to be rising? Falling?

Under what condition would an increase in the unemployment rate be a positive sign?
See all solutions

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free