Unemployment is a socio-economic phenomenon characteristic of any state of the economy. This term means that part of the working-age population does not have the opportunity to find a suitable job. When the number of such people does not exceed 4-6% of the total number of those who are able to work, unemployment is considered natural.
What is unemployment
The reasons for unemployment are different, so it is customary to subdivide it into types. Cyclical unemployment arises due to the reduction in the aggregate demand for labor, which has arisen due to the crisis of overproduction and has a recurring nature. During this period, a large number of people appear who want to work, but have no opportunity to find a job, since the period of production decline, which characterizes the market economy, has begun.
But even during the period of economic recovery, when demand does not exceed supply and full employment is observed, unemployment still remains. During this period, its level, as the experience of most developed countries shows, does not exceed 4-6%. At full employment, there is frictional and structural unemployment, which in the aggregate is called natural.
Forms of natural unemployment
The American monetarist M. Friedman suggested considering two types of unemployment as natural: frictional and structural. Frictional unemployment is a temporary condition for a certain number of the working-age population, which is in search of a more suitable job for themselves or is waiting for an interesting job for them to appear. With natural unemployment, the number of people looking for work is equal to the number of job vacancies. This means that those who want to work will be able to find work, albeit after a while.
The level of frictional unemployment depends on how quickly jobs are found. This level grows over time, as the level of social protection of citizens rises - the amount of unemployment benefits and the level of the minimum wage increases, the requirements for those who receive benefits are reduced. Therefore, this kind of unemployed does not have an urgent need to quickly find a job and they can stretch out the search for a job for a long time.
Another form of natural unemployment is structural unemployment due to scientific and technological progress, technological shifts in production. These factors influence the structure of the economy and entail its change. There is a demand for a certain labor force with one or another qualification, which will be satisfied only after some time, when this force will be attracted from other regions or will appear as a result of training the necessary personnel. This form of natural unemployment is usually forced.
