Cyclical unemployment

Definition

Cyclical unemployment occurs when there is not enough demand for goods and services in the economy, leading to job losses. It varies with the business cycle, increasing during recessions and decreasing during expansions.

Related terms

Economic Recession: A period of temporary economic decline during which trade and industrial activities are reduced, typically identified by a fall in GDP in two successive quarters.

Business Cycle:

The natural rise and fall of economic growth that occurs over time, including periods of expansion, peak, contraction, and trough.

Gross Domestic Product (GDP):

The total value of all goods and services produced over a specific time period within a country's borders; it is used as a broad indicator of an economy's overall health