06/07/2012 01:32 pm ET Updated Aug 07, 2012

Unemployment: A Love Story

Four girls are having brunch at the new place to have brunch in Manhattan, and the conversation, as it so often does, turns to dating. The scene should recall an episode of Sex and the City. Instead it evokes the morning's CNBC joblessness report.

The labor market and the relationship market are eerily similar. In the last four years, unemployment has become the ultimate four-letter word, but singleness -- the dating market equivalent to the labor market's unemployment -- doesn't have to be all doom and gloom. Just as economists distinguish between good and bad unemployment, and agree "ideal unemployment" is above zero, a relationship economist undoubtedly would make the same distinction in her market.

In both the job market and the market of love, high-quality goods clear quickly. The unemployed can be divided between voluntary and involuntary; short-term and long-term; and, in technical language, frictional and structural. A quick vocabulary review to bridge the dating-as-work metaphor:

Structural Unemployment: (aka Involuntary Unemployment, Long-term Unemployment, and Bad Single) Exists because of structural problems in the market, in which the unemployed's skills and job requisites do not match, so that the market cannot absorb everyone. In the labor market, these are unskilled workers "left behind" by innovations. In the dating market, this is the laundry list of awesome traits rarely sought after in personal ads: clinginess, nagging, chronic jealousy...

Frictional Unemployment: (aka Voluntary Unemployment, Search Unemployment, and Good Single) Defined as the search period between voluntarily leaving one job and landing a better one. Frictional unemployment necessarily exists because markets are heterogeneous: Every job is not the right fit for every person any more than every relationship is.

The ideal unemployment rate accounts for frictional unemployment because it's a good thing. Leaving a relationship and leaving a job require a similar courage of being willing to be alone or without a paycheck -- forfeiting financial and emotional security -- for an unknown period. The willingness to leave, without something lined up to replace it, means that after sizing up both the market and the competition, people are confident not only that they won't be single forever, but also that they will find a better match.

On the other hand, a lack of frictional unemployment signals a lack of confidence in the market -- and in themselves. It results in people settling because they doubt they can find something better, which in turn creates a misallocation of resources because people are not pursuing their best fit.

In markets where the average age of marriage is fresh out of college (like my home state of Texas), the relationship unemployment rate is close to zero, and the accompanying heightened divorce rates suggest these early unions often result in a misallocation of resources. Relocating to New York City, where the average age of marriage is early 30s, buys an additional decade to conduct the search process, but with more time comes additional requisites: Many candidates qualify for an entry-level position, but later in careers, candidates differ more and few will meet C-suite requisites of a given company. Does this level of standards reflect becoming a specialist, or does it signal a structural problem of chronic pickiness?

It's hard to say. Empirically, frictional and structural unemployment are tough to distinguish -- besides duration. Here is the human fear: We begin thinking we are frictionally unemployed only to discover our issues are actually structural -- or may become so if we are not careful. Structural unemployment often results from poor past choices, and creates a vicious cycle in which the unemployed become cynical and disheartened, and their skills -- both on the job and in job-seeking -- erode. There lurks the unspoken fear that you're just two cats and a cancelled Brazilian appointment away from being single forever.

Other types of unemployment are born from that fear:

Hidden Unemployment: Unemployment that is not counted in the official statistics, because the definition of unemployment requires not only lack of working, but also 1) being willing/able/available to work, and 2) having actively sought work within the past month. Thus the truly disheartened, who have given up and opted out of the market, are not employed but are also not accounted for in unemployment statistics. In other words, the Cat Lady.

Under Unemployment: A type of hidden unemployment when people are working less than they would like -- settling for a part-time job when they want a full -- or in positions in which their skills are underutilized. In a job market, this is the chef working as a barista. In the relationship market, this is dating casually when you really want a commitment, or settling for someone you are not that into.

Of course, it takes courage to claim the right to be happy, to be honest when we are not, and to leave a good thing in hopes of finding a great thing. Frictional unemployment signals market confidence because people are following their bliss rather than their fear.

One final type of unemployment gives hope now summer has arrived:

Seasonal Unemployment: Periodic unemployment due to seasonal variations in industries affected by weather. Dating is nearly as seasonal as construction. The chances of meeting someone goes up exponentially in the summer, because everyone is outside -- and just generally out -- more, plus at least 24 percent more attractive tan. Now is the time to sharpen your "interviewing" skills and altruistically do your part to help the employment numbers.