Question

When would you expect cyclical unemployment to

be rising? Falling?

Short answer

There are situations when cyclical unemployment will fall and rise. As cyclical unemployment relates to the business cycle of an economy.

Step-by-step solution

Step 1. Definition

Cyclical unemployment is a type of the various types of unemployment. It is defined as unemployment in which the main causes are the cyclical trends in the economy like economic upturn and economic downturn.

Step 2. Explanation

Cyclical unemployment will fall when an economy is doing goods and is in the phase of expansion. Because in the time of expansion the firms will hire a greater number of people.

Cyclical unemployment will rise when the economy is not doing good and is in a state of recession. Because at the time of recession the firms will hesitate from hiring people.