Structural Unemployment

Unemployment that results from a change in the way the local or national economy functions. For example, suppose the economy in a region is heavily dependent on exploiting a single, natural resource. If that resource is entirely consumed, the trained and untrained workers working on exploiting it will find themselves subject to structural unemployment, since there are no other companies exploiting that natural resource because there is no more natural resource. On the plus side, these gaps in the economy can open up new opportunities. See also: Retraining.

structural unemployment

see UNEMPLOYMENT, STRUCTURE OF INDUSTRY.

structural unemployment

the long term UNEMPLOYMENT caused by the decline of certain industries and changes in production processes. It occurs where changing demand patterns in an economy dislocate existing production patterns to the extent that labour becomes redundant. This is a long-term phenomenon requiring the work force to seek other jobs outside the declining industries, possibly in a different part of the country. The problem is one that most governments have had to deal with, for example, the decline in the heavy engineering industries, steel and shipbuilding, in the north of England and in Scotland. Technological change and foreign competition forced the reduction in demand for goods associated with those industries, which resulted in mass unemployment of labour. Countering such unemployment requires extensive occupational retraining programmes for the displaced workers, assistance with moving to new areas where jobs are available, and financial inducements to encourage new growth industries to move to regions blighted by concentrations of declining industries. See REGIONAL POLICY, DEINDUSTRIALIZATION, SUPPLY-SIDE ECONOMICS.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005

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References in periodicals archive

With this approach he estimates structural unemployment for the states of the US economy.

Estimates of structural unemployment rates at a regional level: Example of the Czech economy

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Here, the focus is particularly on the methods of estimating structural unemployment and total factor productivity.

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In the context of this paper, it is important to distinguish between three essential types of unemployment: (i) frictional unemployment; (ii) cyclical unemployment; and (iii) structural unemployment. The first one is related to a situation that not all active job searchers will have yet found or accepted employment, and not all employers will have yet filled their job vacancies.

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Meanwhile, the forum's participants discussed other subjects regarding geographical transformation, structural unemployment, and technological development and their impact on all sectors in the region.

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When such rigidities in the labor market lead to a shortage of jobs it creates structural unemployment and those who are structurally unemployed tend to have longer spells of joblessness on average.

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More than one billion people are still living in extreme poverty, structural unemployment is preventing entire generations from accessing jobs, and women in most parts of the world still face significant barriers in entering the labour force."

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In the long term Saudi rulers have to manage the needs of a rapidly growing population plagued by structural unemployment, and an economy that remains overly dependent on oil revenue and undermined by lavish subsidies.

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Other major risks in terms of their likelihood of occurring include extreme weather events, the failure of states and governments, and continuing high structural unemployment, the report found.

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Developed countries often experience structural unemployment where the persistent mismatch of skills and available jobs requires job seekers to obtain additional education or vocational training.

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On the socio-economic front, issues like reducing inequities in wealth and tackling long-term structural unemployment need urgent attention.

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