Economic Analysis of Social Issues 1st Edition by Alan Grant

Exercise 34

During the 1990s and early 2000s, the United States experienced a residential construction boom. In the Great Recession, the housing market collapsed, and millions of construction workers lost their jobs. In hindsight, it became apparent that the nation had overbuilt housing during the boom and that the construction industry would not be so big in coming decades. Discuss the nature of the unemployment that the laid-off construction workers faced. Was their unemployment frictional, structural, or cyclical? Does your answer depend on the time frame you consider?