Which type of unemployment is characterized by individuals who are unemployed while transitioning between jobs?

Frictional unemployment is characterized by individuals who are temporarily unemployed while they are in between jobs. This type of unemployment occurs when workers are voluntarily leaving their current positions to seek new employment that better matches their skills, preferences, or career goals. It reflects the time it takes for these individuals to find a new job and is often seen as a normal part of the labor market, indicating that workers are actively seeking better opportunities.

Frictional unemployment differs from the other types: natural unemployment encompasses both frictional and structural unemployment; cyclical unemployment arises from economic downturns when demand for goods and services decreases; and structural unemployment occurs when there are mismatches between the skills of the workers and the needs of the job market, often due to technological changes or globalization. Thus, the defining feature of frictional unemployment is the transition period individuals experience as they move from one job to another.