This question was quite popular with the candidates. The candidates were required to differentiate between unemployment and underemployment and to explain with relevant examples some types of unemployment in the (a) and (b) parts of the question respectively. Most of the candidates were unable to differentiate between unemployment and underemployment, as they had a poor understanding of the concept of underemployment in the (a) part of the question, but they were able to explain the types of unemployment with relevant examples in the (b) part of the question.  Candidates scored relatively high marks in this question. Candidates were expected to provide the following answer to score maximum marks in this question.

(a)Unemployment is a situation where people who are able and willing to work at the existing wage rate are unable to find work OR a situation where factors of production such as capital lie idle or cannot be put to productive usewhile underemployment exists when labour is engaged in any form of occupation/work below its full potential OR a situation where resources like capital is not optimally used.

 (b)(i)   Seasonal unemployment: This refers to a fall in demand for labour at certain times of the year due to seasonal changes e.g. when schools are on vacation, sellers in the school canteen become seasonally unemployed; farmers become unemployed during the dry season.                                       

     (ii)   Structural unemployment: This occurs when there is a fall in the demand for the product of an industry leading to workers being permanently laid off.  OR Structural unemployment occurs where the process of production changes, such that some workers become redundant e.g, the use of earthmoving equipment has  renderedlabourers who use pick axes and shovels  redundant in the construction industry; counting machines and  ATMs have resulted in less people being employed as  cashiers.                                                                                                                                                
(iii) Frictional unemployment: This is caused by workers changing jobs or school leavers searching for jobs e.g. a fresh graduate looking for a job.                                                                                                                                  
(iv) Cyclical unemployment: This is unemployment caused by a deficiency in aggregate demand leading to a deflationary phase of the business cycle e.g. when aggregate demand falls, firms need to cut down on labour.