Question

For each of the following, indicate if the person would be classified officially as employed, unemployed (STRUCTURAL/FRICTIONAL/CYCLICAL), or not in the labor force: GIVE AN EXPLANATION IN EACH CASE IN FEW WORDS ONLY.

(i) A worker quits his job at the Post office to find more interesting work.

(ii) Collin has lost his job with a telemarketing company, which has moved its operation to India and he is now looking for a new job.

(iii) Frank recently lost his job as the computer manufacturing company he works for recently downsized after poor sales and poor performance of the economy during the last year

Answer 1

1)A worker quits his job at the post office to find a more interesting job

FRICTIONAL UNEMPLOYMENT

(As the worker voluntarily left his job looking for a more interesting one.Frictional unemployment is a part of job searching process and is usually short termed,it helps people to find job which utilizes their productivity to the maximum)

(2) Collin has lost his job with a telemarketing company,which has moved its operation to INDIA and he is now looking for a new job.

STRUCTURAL UNEMPLOYMENT

(As the company has outsourced its work to INDIA,it has given rise to structural unemployment,which has long term effects,as it becomes difficult for the economy to create job opportunities for the unemployed)

(3)Frank recently lost his job as the computer manufacturing company he works for recently downsized after poor sales and poor performance of the economy during the last year.

(CYCLICAL UNEMPLOYMENT)

(Cyclic unemployment is caused by the fluctuations in the business cycles,when demand for a commodity falls it forces the producers to cut their costs by downsizing ,creating unemployment)