30 Key Terms
Cyclical Unemployment
Unemployment closely tied to the business cycle, like higher unemployment during a recession.
Discouraged Workers
Those who have stopped looking for employment due to the lack of suitable positions available.
Employed
Currently working for pay.
Frictional Unemployment
Unemployment that occurs as workers move between jobs.
Labor Force
The number of employed plus the unemployed.
Labor Force Participation Rate
This is the percentage of adults in an economy who are either employed or who are unemployed and looking for a job.
Natural Rate of Unemployment
The unemployment rate that would exist in a growing and healthy economy from the combination of economic, social, and political factors that exist at a given time.
Not in the Labor Force
Those who are not working and not looking for work, whether they want employment or not; also termed “out of the labor force.”
Structural Unemployment
Unemployment that occurs because individuals lack skills valued by employers.
Underemployed
Individuals who are employed in a job that is below their skills.
Unemployed
Out of work and actively looking for a job.
Unemployment Rate
The percentage of adults who are in the labor force and thus seeking jobs, but who do not have jobs. (1)