A peak is reached, after which economic activity declines. If the contraction is severe enough, prices may also decline. The trough marks the end of a contraction and the beginning of a new expansion. The unemployment rate is the percentage of the labor force that is not working. To be in the U.S. labor force, an individual must be working or actively seeking work.
Some types of unemployment have more impact on the economy than others.
Frictional unemployment occurs when previously employed workers change job or new workers seek their first jobs. Seasonal unemployment is a product of regular, recurring changes in the hiring needs of certain industries. Both these types of unemployment tend to be short-term. Structural unemployment, on the other hand, can be long-term. Structurally unemployed persons can't find any job they can do.