Frictional and Cyclical Unemployment:

Frictional Unemployment:

It refers to unemployment caused by changes in individual labour markets. This is the type of unemployment resulting from people who have left jobs that did not work out and are searching for new employment or people who are either entering or re-entering the labour force to search for a job.

Cyclical Unemployment:

This is the type of employment resulting from decline in real aggregate output in the economy. It can also be defined as unemployment caused by deficiency of aggregate or total spending. This is sometimes referred to as deficient-demand unemployment.