| unemployment caused by basic changes in the overall economy, as in demographics, technology, or industrial organization. |
| Main Entry: | structural unemployment |
| Part of Speech: | n |
| Definition: | unemployment that occurs due to industrial reorganization rather than changes in supply or demand |
Relatively long-lasting unemployment resulting from long-term shifts in economies and markets rather than short-term savings in economic conditions.
Note: Structural unemployment tends to develop around major changes in an economy, such as the move from an industrial to a technological economy. Workers displaced by the decline of the old economy tend not to be trained in fields suitable for the new economy, so they remain out of work.
Structural Unemployment
Unemployment resulting from changes in the basic composition of the economy. These changes simultaneously open new positions for trained workers.
Investopedia Commentary
An example of structural unemployment is the technological revolution. Computers may have eliminated jobs, but they also opened up new positions for those who have the skills to operate the computers.
Related Links
Surveying The Employment Report
Macroeconomic Analysis
See also: Coincident Indicator, Cyclical Unemployment, Frictional Unemployment, Lagging Indicator, Natural Unemployment