(NewsNation) — Unemployment can be voluntary, like when you leave one job for a higher-paying one, or it can be involuntary, when you’re fired or laid off.
There are four subcategories of unemployment: frictional, cyclical, structural and institutional.
- Frictional unemployment: Short-lived; when people voluntarily leave jobs or recent graduates looking to enter the workforce
- Cyclical unemployment: Fluctuates during recessionary and economic growth periods.
- Structural unemployment: Long-term; results from a technological change in the structure of the economy and displaced workers.
- Institutional unemployment: Long-term or permanent; results from long-term institutional factors, such as government policies like minimum wage.