Unemployment is a socio-economic phenomenon in which part of the active working population is not involved in the production of goods and services. This is a macroeconomic problem that has the most direct impact on each person, since the loss of work in most cases means a decrease in living standards.
Instruction manual
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There are several types of unemployment - frictional, structural, institutional, seasonal, cyclical and others. In contrast to the natural type of unemployment, which includes the first two types, cyclical unemployment does not arise as a result of a lack of jobs, but with a slowdown in economic growth, a decline in GDP, and an industrial crisis. For example, during the period of the Great Depression in the USA, every fourth resident of the country became unemployed.
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Cyclical unemployment affects all sectors of the economy. Massive bankruptcies of small and even large companies cause unexpected and sudden layoffs and layoffs. In addition, in conditions of economic recession, retraining or advanced training does not help people, and changing their place of residence does not save, since the crisis often covers the entire national economy or even reaches the world level.
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The cyclical unemployment caused by the economic crisis can be manifested in an open and latent form. Open is expressed in the dismissal and complete loss of work, hidden is manifested in the reduction of the working week or working day, forced leave, decrease in wages.
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Cyclical unemployment is the most massive and painful, in addition to social disasters, it brings losses in the volume of real GDP. The American economist Arthur Ouken, comparing GDP in the conditions of actual and full employment, concluded that the excess of cyclical unemployment over natural unemployment by even 1 percent leads to a decrease in the actual level of GDP by 2.5 percent, compared with the potential level of gross product.
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In conditions of cyclical unemployment, the state incurs budget expenditures to mitigate the consequences - paying benefits, opening employment centers, rehabilitating the unemployed, creating new jobs at the expense of the state, reorienting tax policy, etc.
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Since the development of the economy is cyclical and involves the alternation of recessions and ups, cyclical unemployment is significantly reduced during the next upsurge and can completely disappear.
