2. Frictional
Unemployment: It
exists when there is
lack of adjustment
between demand for
and supply of labour
force.
Example: When
someone is laid off,
changes jobs, or need
time to find a job after
graduating from school.
3. Structural Unemployment: This refers to a situation when a large
number of people do not get work because of limited job opportunities
available.
Causes of Structural Unemployment:
New Technology
New Resources
Changes in Consumer Demand
Globalization- Shift to foreign markets
Lack of Education
Example: Unemployment in India is basically structural in nature.
4. Seasonal Unemployment: This refers to a situation when people get work
during some days or months of the year, but not regularly throughout the year
and, therefore, they are unemployed during some part of the year.
Examples: When people who sell fire crackers on Diwali are out of a job
because the festival has passed.
5. Cyclical Unemployment: It is associated with the downswing and depression
phases of business cycle.
Examples: A recession causes people to save more and spend less, because of
this companies may slow down production and lay off workers.
6. Open Unemployment: It refers to
situation when there are some workers
who have absolutely no work to do.
Examples: Frictional, Structural and
Cyclical unemployment are different
examples of Open unemployment.
7. Disguised Unemployment: This refers to a situation when the number of workers
engaged in a job is much more than actually required to do the given work.
For Example, if a piece of land requires only three people to work on it and
instead five people are working on it, then the two extra people are said to be in
a situation of disguised unemployment.
8. Underemployment: It refers to a situation when the employed persons are
contributing to production and income which is less than what they are really
capable of.
For Example, an individual with an engineering degree working as a pizza
delivery man as his main source of income is considered to be
underemployed.