What are the different types of unemployment and how do they apply to real-life situations in the Philippines?
Answer (2)
There are three main types of unemployment: frictional, structural, and cyclical. Each type explains why people are jobless and gives insight into what kind of solutions may be needed. In the Philippine setting, these types are all present in different forms.Frictional unemployment happens when people are temporarily out of work because they are between jobs or new to the job market. For example, a fresh graduate in Cebu who is looking for a job but hasn't found one yet is frictionally unemployed. This type is natural and usually short-term. It also includes someone who resigns from a job to find a better one.Structural unemployment occurs when a person's skills are no longer in demand, or when jobs move to another place. For example, a factory worker in Laguna might lose their job because the company automated their machines or transferred operations abroad. The worker must retrain or learn new skills to find a new job. This kind of unemployment is more long-term and requires education and retraining programs, like those offered by TESDA.Cyclical unemployment is caused by a downturn in the economy. During a recession, many businesses reduce staff to cut costs. A tricycle driver in a tourism area like Palawan might lose customers during a tourism slump, or a mall worker might be laid off when retail sales drop. This type of unemployment is common during crises, such as the COVID-19 pandemic when millions of Filipinos lost their jobs.Frictional - needs better job matching and job search toolsStructural - needs training and educationCyclical - needs government stimulus and public job programsUnemployment is not just about “not having work.” It’s about why work is missing and what can be done about it. Recognizing the different types allows for more targeted and effective solutions to help Filipinos find meaningful employment.
Main Types of Unemployment Frictional UnemploymentThis happens when people are temporarily between jobs or searching for their first job. For example, fresh graduates in the Philippines looking for suitable work or workers switching jobs experience this.Structural UnemploymentOccurs when workers' skills don’t match job requirements due to changes in the economy or technology. In the Philippines, some workers in traditional industries like agriculture may struggle to find jobs in urban areas or tech-based industries.Cyclical UnemploymentLinked to the economic cycle—rises during recessions and falls in booms. For example, during economic slowdowns in the Philippines, many businesses cut back or close, causing layoffs.Seasonal UnemploymentHappens when jobs are only available during certain seasons. Filipino workers in agriculture, tourism, and fishing often face this, as their work depends on planting/harvesting seasons or tourist flows.Hidden UnemploymentPeople who have given up looking for work but still want a job. In the Philippines, this includes discouraged workers who stop job hunting due to lack of opportunities.
