Unemployment and its types
Unemployment is problem faced when there are people, who are
willing to work and able to work but cannot find suitable jobs.
While formulating policies to solve the problem of unemployment in
India for instance, we need to distinguish between the nature of unemployment
in rural
India’s rural economy has both
unemployment and underemployment. The major feature of rural unemployment is
the existence of unemployment in the form of disguised unemployment and
seasonal unemployment. In India, frictional, structural and open unemployment
exist in urban areas. Due to urbanization, a large number of people move from
rural areas to urban areas. This migration from rural to urban areas increases
the size of labour force in urban areas and adds to the already unemployed
labour force.
In developing countries like India, the nature of unemployment is
different from that of developed countries. In developed countries, the
unemployment is purely temporary or cyclical or frictional. But in the
developing countries, it is largely structural unemployment which is due to
slow rate of capital formation.
The following are the types of unemployment.
This unemployment exists during the downturn phase of trade cycle
in the economy. In a business cycle during the period of recession and
depression, income and output fall leading to widespread unemployment. It is
caused by deficiency of effective demand. Cyclical unemployment can be cured by
public investment or expansionary monetary policy.
This type of unemployment occurs during certain seasons of the
year. In agriculture and agro based industries like sugar,production activities
are carried out only in some seasons. These industries offer employment only
during that season in a year. Therefore people may remain unemployed during the
off season. Seasonal unemployment happens from demand side also; for example
ice cream industry, holiday resorts etc.
Frictional unemployment arises due to imbalance between supply of
labour and demand for labour. This is because of immobility of labour, lack of
necessary skills, break down of machinery, shortage of raw materials etc. The
persons who lose jobs and in search of jobs are also included under frictional
unemployment.
Sometimes educated people are underemployed or unemployed when
qualification does not match the job. Faulty education system, lack of
employable skills, mass student turnout and preference for white collar jobs
are highly responsible for educated unemployment in India.
Modern technology being capital intensive requires less labourers
and contributes to technological unemployment. Now a days, invention and
innovations lead to the adoption of new techniques there by the existing
workers are retrenched. Labour saving devices are responsible for technological
unemployment.
Structural unemployment is due to drastic change in the structure
of the society. Lack of demand for the product or shift in demand to other
products cause this type of unemployment. For example rise in demand for mobile
phones has adversely affected the demand for cameras, tape recorders etc. So
this kind of unemployment results from massive and deep rooted changes in
economic structure.
Disguised unemployment occurs when more people are there than what
is actually required. Even if some workers are withdrawn, production does not
suffer. This type of unemployment is found in agriculture. A person is said to
be disguisedly by unemployed if his contribution to output is less than what he
can produce by working for normal hours per day. In this situation, marginal
productivity of labour is zero or less or negative.
Related Topics
Privacy Policy, Terms and Conditions, DMCA Policy and Compliant
Copyright © 2018-2024 BrainKart.com; All Rights Reserved. Developed by Therithal info, Chennai.