Jul 06, 2011 1) Structural Unemployment: - This type unemployment is associated with economic structure of the country. When demand for labour falls short.

• Unemployment In India Economy

ADVERTISEMENTS: In other words unemployment means only involuntary unemployment wherein a person who is willing to work at the existing wage rate does not get a job. Types of Unemployment in India: 1. Open Unemployment: Open unemployment is a situation where in a large section of the labour force does not get a job that may yield them regular income. This type of unemployment can be seen and counted in terms of the number of unemployed persons. The labour force expands at a faster rate than the growth rate of economy. Therefore all people do not get jobs.

Disguised Unemployment: It is a situation in which more people are doing work than actually required. Even if some are withdrawn, production does not suffer. In other words it refers to a situation of employment with surplus manpower in which some workers have zero marginal productivity. So their removal will not affect the volume of total production. Overcrowding in agriculture due to rapid growth of population and lack of alternative job opportunities may be cited as the main reasons for disguised unemployment in India.

Seasonal Unemployment. ADVERTISEMENTS: It is unemployment that occurs during certain seasons of the year. In some industries and occupations like agriculture, holiday resorts, ice factories etc., production activities take place only in some seasons. So they offer employment for only a certain period of time in a year. People engaged in such type of activities may remain unemployed during the off-season. Cyclical Unemployment: It is caused by trade cycles at regular intervals.

Generally capitalist economies are subject to trade cycles. The down swing in business activities results in unemployment.

Cyclical unemployment is normally a shot-run phenomenon. Educated Unemployment: Among the educated people, apart from open unemployment, many are underemployed because their qualification does not match the job. Faulty education system, mass output, preference for white collar jobs, lack of employable skills and dwindling formal salaried jobs are mainly responsible for unemployment among educated youths in India.

Educated unemployment may be either open or underemployment. Technological Unemployment: It is the result of certain changes in the techniques of production which may not warrant much labour. Modern technology being capital intensive requires less labourers and contributes to this kind of unemployment. Structural Unemployment: This type of unemployment arises due to drastic changes in the economic structure of a country. These changes may affect either the supply of a factor or demand for a factor of production.

Unemployment In India Economy

Structural employment is a natural outcome of economic development and technological advancement and innovation that are taking place rapidly all over the world in every sphere. Underemployment: It is a situation in which people employed contribute less than their capacity to production. In this type of unemployment people are not gainfully employed.

They may be employed either on part-time basis, or undertake a job for which lesser qualification is required. For example a Post Graduate may work as a clerk for which only S.S.L.C. Casual Unemployment: When a person is employed on a day-to-day basis, casual unemployment may occur due to short-term contracts, shortage of raw materials, fall in demand, change of ownership etc.

Chronic Unemployment: If unemployment continues to be a long term feature of a country, it is called chronic unemployment. Rapid growth of population and inadequate level of economic development on account of vicious circle of poverty are the main causes for chronic unemployment. Frictional Unemployment: Frictional unemployment is caused due to improper adjustment between supply of labour and demand for labour. This type of unemployment is due to immobility of labour, lack of correct and timely information, seasonal nature of work.

Measurement of Unemployment: There are three measures or estimates of unemployment. These are developed by National Sample Survey Organisation (NSSO).

Usual Status Unemployment. ADVERTISEMENTS: Also known as open unemployment or chronic unemployment. This measure estimates the number of persons who remained unemployed for a major part of the year. This measure gives the lowest estimates of unemployment. This concept used to determine the usual activity status of a person as employed or unemployed or outside the labour force. The persons covered may be classified into those working or available for work in their principal activity sector and subsidiary sector. Weekly Status Unemployment: The estimate measures unemployment with respect to one week.

A person is said to be unemployed if he is not able to work even for an hour during the survey period. In other words according to this estimate a person is said to be employed for the week even if he/she is employed only for a day during that week. Current Daily Status Unemployment: It considers the activity status of a person for each day of the preceding seven days.

The reference period here is a day. If a person did not find work on a day or some days during the survey week, he/she is regarded as unemployed.

Normally if a person works for four hours or more during a day, he or she is considered as employed for the whole day. The daily status unemployment is considered to be a comprehensive measure of unemployment. Causes of Unemployment in India: The important causes of Unemployment in India are as follows: 1. Rapid growth of population and increase in labour force. Underdevelopment of the economy.

Slow growth in the agricultural sector. Defective system of education. Absence of manpower planning. Degeneration of village industries. Inappropriate technology.

Slow growth of industrial sector. Immobility of labour.

Jobless growth.

ADVERTISEMENTS: This is primarily confined to agriculture. Agriculture does not provide employment round the year. It is also known as perennial unemployment. Sowing and harvesting season ranges between five and seven months. For the rest of the period the cultivator has to remain idle. Experts believe that an Indian cultivator remains unemployed for five to six months.

When the next sowing season starts he again goes back to cultivation. Therefore, it is called seasonal unemployment. (b) Disguised Unemployment or Underemployment: It is again a feature of the agrarian economies. When more people are engaged than actually required for production, it is called disguised unemployment. If a part of labour force is withdrawn from the farm the total output of the farm will remain unchanged. The withdrawn labour force will be termed as disguisedly employed.

Under this situation the marginal productivity of labour (i. E., the addition to the total product) over a wide range is zero. Indian agriculture is a self-employing sector. There is absence of alternative occupations in the economy.

The burden of increasing population ultimately; falls on land and there is overcrowding on the farms. Rigid social structure and joint family system encourage this overcrowding. No one appears to be unemployed. But in reality, large part of the labour force is underemployed. Urban Unemployment: According to 2001 Census, 27.8 per cent population lives in urban areas.

Therefore, the magnitude of urban unemployment is not as high as that of rural unemployment. Two kinds of unemployment exist in the urban areas: (a) Industrial Unemployment.

ADVERTISEMENTS: The Britishers had totally destroyed the village based industries. The condition of artisans and farmers was not good. They migrated to the urban areas in search of jobs. But they could only increase the number of unemployed persons. In recent years many industries have been modernized. New and automation techniques of production have rendered many workers unemployed.

It is called ‘technological unemployment. Industrial activities are increasing by leaps and bounds. Fluctuations in the business activities affect the level of employment. Industrial recession of 1966-68 rendered many workers unemployed. Recent power shortage in many states has slackened the industrial activity and increased the number of unemployed persons. It is called ‘cyclical unemployment’. (b) Educated Unemployment: Indian universities and colleges have been producing lakhs of graduates every year.

Education in India is not ‘job oriented’. Students have been aimlessly studying different courses. When they come out of college after completing their education, they fail to get suitable jobs. Educated unemployment entails a waste of the country’s most valuable resource, the human capital.