Structural Unemployment

Unemployment refers to the situation in which an individual who is able and willing to work at an existing wage rate does not get work. After going through this post, you will be able to understand Structural Unemployment.

Structural Unemployment

Structural Unemployment Definition

Structural Unemployment refers to the situation in which individuals are unable to find jobs due to structural changes in the economy.

Causes of Structural Unemployment

  • Changes in technology: With the development process, the industrial sector in a country tends to switch to modern techniques of production. People who are not able to adapt to these technological changes are rendered unemployed.
  • Changes in demand patterns: Over time, people’s tastes and preferences change with respect to different commodities. In other words, the demand patterns of consumers undergo changes. Industries that adapt to changing market demands and modify their products accordingly are able to survive in the market. On the other hand, industries that are not able to operate in accordance with changing demands are closed down. Consequently, the people engaged in these industries lose their jobs and become unemployed.

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