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Frictional unemployment

Frictional unemployment is a form of unemployment reflecting the gap between someone voluntarily leaving a job and finding another. As such, it is sometimes called search unemployment, though it also includes gaps in employment when transferring from one job to another.[1]

Frictional unemployment is one of the three broad categories of unemployment, the others being structural unemployment and cyclical unemployment. Causes of frictional unemployment include better job opportunities, services, salary and wages, dissatisfaction with the previous job, and strikes by trade unions and other forms of non-unionized work actions.

educational advice;

information on available jobs and workers;

combating (against certain workers, jobs or locations);

prejudice

incentives and regulations (e.g. when the frictionally unemployed receive benefits);

relocation of industries and services;

facilities to increase availability and flexibility (e.g. );

daycare centers

aid or grants to overcome a specific obstacle (e.g. if a disabled worker is employed);

reduction of the gap between gross and net wages (e.g. by taxing consumption instead).

When handing out work permits (to foreigners), i.e. must stay with that company at the same work place address as state on the work permit.

Policies to reduce frictional unemployment include:

Archived 2010-11-05 at the Wayback Machine, Scientific Background on the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2010 compiled by the Economic Sciences Prize Committee of the Royal Swedish Academy of Sciences.

Market with search frictions