Economics • Economic BasicsMedium
Which of the following best defines the concept of structural unemployment in a developing market economy?
A. Temporary joblessness occurring during the transition between two successive employments
B. Unemployment resulting from seasonal fluctuations in agricultural and allied activities
C. Mismatch between the skills possessed by the labor force and the skills demanded by employers✓ Correct Answer
D. Joblessness caused by a general deficiency in aggregate demand during an economic recession
💡 Solution & Explanation
Structural unemployment arises when there is a fundamental mismatch between worker skills and market demand, often driven by technological advancements or shifting industrial requirements. Temporary joblessness refers to frictional unemployment, whereas seasonal work affects agriculture and tourism. Deficient aggregate demand characterizes cyclical unemployment rather than structural imbalances. Retraining programs and educational reforms are standard policy instruments deployed to bridge this specific labor market gap.
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