In what scenario would structural unemployment typically arise?

Structural unemployment arises primarily due to changes in the economy that create a mismatch between the skills workers possess and the skills required for available jobs. This situation often occurs during technological advancements, which can render certain skills obsolete and displace workers. As innovation progresses, some jobs may become automated or require new skill sets that affected workers may not possess, leading to longer periods of unemployment for those who need to retrain or acquire new competencies.

In contrast, scenarios involving sudden consumer demand or temporary seasonal work shortages typically lead to higher employment levels or fluctuations in job availability without permanently displacing workers. Keeping wages above market levels can indeed contribute to unemployment, but that reflects more of a frictional or cyclical nature rather than the fundamental shift in the job market that characterizes structural unemployment.