91Ó°ÊÓ

For an economy, who desires to pursue a goal of zero unemployment might face issues in three different types of unemployment that are cyclical, frictional and structural unemployment.

Let's discuss the three of them separately:-

Cyclical Unemployment relates to the cyclic trends in the economy and the business industry. It is a component of overall unemployment and it affects the economic recession or expansion.

Frictional unemployment occurs when workers choose to leave their jobs in search of new ones and as we know it takes time to find new jobs and to continue with the whole process of job. So, as the workers moves between new jobs it leads to frictional unemployment.

Structural Unemployment occurs when people don't have the exact skill that is required to fulfill the demand or because they never learned those skills.

These all three unemployment are somehow significant for an economy to have as the cyclical employment helps to stimulate the growth of the economy in future. Further, frictional unemployment is also not a bad things people need to find new opportunities, they want to become successful which is equally important for an individual or a company. Just like these two, structural unemployment also plays a important role as people need workers who can handle the new technologies. So, they have created the demand for high skilled workers. Hence, the above explains, why pursuing a goal of zero unemployment is not desirable.