Question 39

Structural unemployment results from technological change.

Technological advancements can lead to structural unemployment as they often render certain skills obsolete, making it difficult for workers to find jobs that match their abilities.

A) Frictional

Frictional unemployment occurs when individuals are temporarily unemployed while transitioning between jobs or entering the workforce. This type of unemployment is not directly caused by technological changes, but rather by the time taken for job seekers to find suitable positions.

B) Cyclical

Cyclical unemployment is linked to the economic cycle, occurring during downturns when demand for goods and services decreases. While technological change can influence economic cycles, cyclical unemployment is primarily a result of macroeconomic factors rather than direct changes in technology.

C) Seasonal

Seasonal unemployment happens when individuals are unemployed at certain times of the year when demand for labor is lower, such as in agriculture or tourism. This type of unemployment is not influenced by technological advancements but by the seasonality of certain industries.

D) Structural

Structural unemployment is directly caused by technological changes that alter the demand for certain skills in the labor market. As technology evolves, workers may find their skills outdated, leading to longer periods of unemployment as they seek retraining or transition to new jobs that require different skills.

Conclusion

Structural unemployment is the correct answer because it specifically addresses the impact of technological change on the labor market, leading to a mismatch between workers' skills and job opportunities. In contrast, frictional, cyclical, and seasonal unemployment are influenced by factors unrelated to technological advancements, making them incorrect in this context.