UNEMPLOYMENT

Labour Force

Total population in a region, within a set range of ages, that is

considered to be able and likely to work.

Labour force of a country includes both the employed and the

unemployed.

Unemployment

Unemployment is the inability of the labour-force participants

to find jobs at current wage rates.

Rate of unemployment is expressed as a percentage of total

labour force.

Classification of Unemployment
Real-Wage

Disequilibrium

Cyclical
Growth in labour
supply

Unemployment

Frictional

Equilibrium

Structural

Seasonal

Aggregate demand and supply curve for labour

Types of Disequilibrium Unemployment

Real-Wage Unemployment

Demand-deficient or cyclical Unemployment

Unemployment due to growth in labour supply

Types of Equilibrium Unemployment

Frictional (search) Unemployment

Structural Unemployment

Seasonal Unemployment