Joan works in the tourist sector of the economy. She is laid off each October until the following March. When Joan becomes unemployed in October, this is an example of which type of unemployment?

• A. Discretionary
• B. Frictional
• C. Seasonal
• D. Structural

Answer: (C)

Seasonal unemployment happens when the demand for labor swings with the time of year, causing workers to be employed only during certain seasons. Joan’s job in the tourist sector fits this pattern because tourism often peaks in some months and drops in others, leading to October layoffs and a return to work in March. This isn’t frictional unemployment, which is about short-term job searching or transitions between jobs, nor structural unemployment, which stems from a long-term mismatch between skills and available jobs. The term discretionary isn’t a standard category for unemployment types here. So the situation reflects seasonal unemployment.