Frictional and structural unemployment

[jeffsui]

What is one government economic policy to adress structural unemployemnt, and one to adress frictional unemployment

[georgebanis]

What is one government economic policy to adress structural unemployemnt, and one to adress frictional unemployment

Structural unemployment has to do with a mismatch of skills whereas frictional unemployment refers to temporary unemployment when switching between jobs.

Using this, the government can reduce the structural UR primarily through training programs in order to give unemployed people the skills required by employers for job vacancies. An example was a $150 million package allocated by the government to employees in the automobile industry who had lost their jobs when the production of Holden moved overseas. So structural unemployment is addressed by training packages which give the unemployed more skills and qualifications, and equip them with the skills matching job vacancies.

Frictional unemployment is a little bit different, as some level of frictional unemployment is inevitable since people are always moving between jobs. This can still be addressed by improving the accuracy of job-matching agencies which help connect the unemployed to work availability, reducing the amount of time people spend unemployed. An example of such an agency is Jobactive.

Hope this helps!