ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What is Frictional Unemployment? Frictional unemployment is a type of unemployment that arises when workers are searching for new jobs or are transitioning from one job to another. It is part of natural unemployment and hence is present even when the economy is considered at full employment.

Detailed explanation-2: -For example, a worker who quits their job in anticipation of lining up another one or someone who has just entered the workforce after graduation would be considered frictionally unemployed.

Detailed explanation-3: -Frictional unemployment is a type of short-term unemployment. Frictional unemployment happens when a person is voluntarily job searching or searching for a new career. Frictional unemployment isn’t necessarily a bad thing. In fact, because frictional unemployment is voluntary, it can be a sign of a healthy economy.

Detailed explanation-4: -Frictional unemployment occurs in a growing, stable economy. Workers moving from job to job and new workers entering the workforce contribute to frictional unemployment. Frictional unemployment is also caused by those deciding to prioritize taking care of their family, returning to school, or finding purpose in life.

Detailed explanation-5: -Frictional unemployment occurs when individuals voluntarily choose to leave their job in search of a new one or when new workers enter the job market. When people leave their current job to find a new one or are seeking their first-ever job, then this is called frictional unemployment.