structural unemployment

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.