This study focuses on the role of the federal government in reducing persistent joblessness that prevails at relatively high levels even during periods of high employment or prosperity ("structural unemployment"). While the problem of cyclincal joblessness dominates public policy discussion at the present time, structural unemployment is being increasingly recognized as one of the nation's most serious domestic problems. Persistent high levels of "prosperity" or structural unemployment are attributable to seemingly intractable structural imbalances within the economy. The key policy problem centers on the use of aggregative and structural policies to reduce total unemployment to the 4-5 percent range and to bring the hard-to-employ into the economic mainstream without inducing increased inflation. The study concludes that, while differing in degree, both cyclical and structural unemployment should be addressed in periods of high as in periods of low employment. The most critical issue to resolve is how to balance short-run and long-run goals for the economy in the selection of public policy alternatives. (KC)