UNEMPLOYMENT

Unemployment is a situation where a person is able and willing to do work but is not getting work at existing wage rate. We can relate unemployment to Philips curve as well.

Contents

Types of unemployment

Disguised unemployment : It is also called as hidden unemployment. The number of workers engaged in a job is much more than the number of people actually employed
Frictional unemployment : It is also called as temporary unemployment. It exists during the period where workers leave one job and join other
Seasonal unemployment : Due to season
Open/ involuntary unemployment : Name defines. Ex: govt jobs (students)
Structural unemployment : Defects in structure (mismatch between skills)
Cyclical unemployment : Relate to boom and recession (business cycle)
Educated unemployment : When economy is unable to provide employment opportunities

Causes of unemployment

Slow rate of economic growth
Population explosion
Underdeveloped agriculture
Defective education system
Decline of cottage and small industries
Faulty planning
Rural urban migrations
Lack of capital
Seasonal variations
Lack of skill and work experience
Lack of credit facility
Limited mobility of labour
Joint family system
Agriculture is seasonal occupation

Consequences

Increase in criminal activities
Violence
Drug addiction
Terrorism
Social and moral evils

Remedies

Accelerating growth rate of GDP
Control over population
Empowerment of small-scale industries
Self-employment
Change in education system
Change in technique of production
Provision of easy credit
Internship programs
Vocational and technical teaching centres
Encouragement of construction industry
Employment programmes by government
Proper technique of production (LIT- labour intensive technique and CIT- capital intensive technique)

Source of unemployment in India

Report of census of India
National sample survey organisation (NSSO)
Directorate general of employment and training (DGET)

Underemployment

Situation where people are unable to find the job according to their skills and experience, hence willing to do any job lower than their level of education and experience. Ex: a PhD working as a salesman.