Canadian Securities Course (CSC) Level 1 Practice Exam

At which types of businesses does seasonal unemployment typically apply?

1. Retail stores

2. Restaurants

3. Construction companies

4. Farms

The correct answer is: Farms

Seasonal unemployment is a phenomenon that occurs when individuals are employed during specific seasons of the year and face unemployment during off-seasons. This is particularly relevant in industries that experience fluctuations in demand based on seasons. Farms are the quintessential example of this, as agricultural work often depends heavily on specific planting and harvesting seasons. During the peak growing season, farms hire additional labor to manage the heightened activity, but once the harvest is complete, many of these workers may find themselves unemployed until the next season of planting or harvesting begins. In contrast, retail stores can experience peak seasons, such as the holiday shopping period, but they typically maintain staff year-round, albeit with changes in hours or roles. Restaurants, while they might see fluctuations in customers based on seasons or events, often have a continuous need for staff. Construction companies may also face variations in work due to weather conditions but do not strictly experience seasonal unemployment in the same way farms do, as construction projects can vary greatly in timing and scope based on contracts and demand. Thus, farms best exemplify seasonal unemployment as their workforce is directly tied to distinct agricultural cycles.