The classical thinkers like Adam Smith, Ricardo, Malthus. J.B. Say. etc believed that full employment is a normal situation and unemployment is a rare exception. Their theory of employment is based upon the Lessees faire policy, which does not allow any intervention by the state. Under competitive conditions, where the demand and the supply forces are allowed to operate freely, the economic system will tend to maintain full employment of the resources. Any intervention by the government will only create instability in the system. In case there is unemployment in the economy. It will only be a temporary phenomenon. The demand and supply forces get activated and restore full employment equilibrium in no time. Thus, unemployment is a self-correcting mechanism.

The classical economists completely ruled out the existence of involuntary unemployment, however, they did not rule out voluntary unemployment and fictional unemployment. But, these types of unemployment are not going to last for long.

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