| Chapter 12 Outline |
| III. TYPES OF UNEMPLOYMENT |
| A. Frictional Unemployment |
| 1. Frictional unemployment is temporary unemployment arising from the normal job search process. |
| 2. Frictional unemployment helps the economy function more efficiently. |
| B. Structural Unemployment |
| 1. Structural unemployment is the result of structural changes in the economy caused by technological progress and shifts in the demand for goods and services. |
| a. The structural changes eliminate some jobs in the economy and create others. |
| 2. Persons who are structurally unemployed do not have marketable job skills and may face prolonged periods of unemployment. |
| C. Cyclical Unemployment |
| 1. Cyclical unemployment is unemployment caused by a drop in the level of economic activity that occurs during the contraction phase of the business cycle. |