A large number of well-trained, willing-to-work individuals have given up trying to find employment.

When individuals stop actively seeking work, they are no longer considered part of thelabour force, and this reduces theunemployment ratesince it only includes those actively seeking employment.

A (Structural unemployment)remains unchanged as this relates to mismatches in skills or geographic factors.

C (Participation rate)decreases since fewer individuals are in the labour force.

D (Labour force)decreases as individuals withdraw from it.

References:Volume 1, Chapter 4 ("Labour Market Indicators")​.