Question

People who are unemployed because wages are, for some reason, set above the level that brings labor supply and demand into equilibrium are best classified as Group of answer choices cyclically unemployed. structurally unemployed. frictionally unemployed. discouraged workers.

Answer 1

Answer: structurally unemployed

Explanation: The structurally unemployed are people who are unemployed because wages are, for some reason, set above the level that brings labor supply and demand into equilibrium. This translates to a mismatch between the jobs available and the skill levels of unemployed workers i.e., the skills unemployed workers have do not match the skills needed or required by employers which often are higher paying. Structural unemployment is caused by forces such as technological advancements, trade agreements etc. Typically it occurs when an underlying shift in the economy makes it difficult for some group of workers to obtain jobs.