Unemployment In India

Unemployment In India

Most of the unemployment in India is structural in nature. During the past three decades population in this country has grown at an alarming rate and with it, the number of people coming to the labour market in search of jobs has also increased rapidly, but employment opportunities have not increased due to slow economic growth. This unemployment can be eliminated only by introducing certain reforms in the structure of the economy.

Types Of Unemployment

For analytical convenience, we shall now classify unemployment in the country as

  1. Urban Unemployment
  2. Rural Uņemployment
  3. Seasonal Unemployment
  4. Disguised Unemployment

Unemployment In Urban Areas

According to the NSS, Current Daily Status rural unemployment rate for male workers was 4.58 per cent in 1987-88. Since then unemployment among rural male workers has increased. The current daily status unemployment rate for the rural male workers was 8.0 per cent in 2004-05 as against 7.2 per cent in 1999-2000 and 5.64 per cent in 1993-94. Most of the unemployment in urban areas is open and undisguised. Unemployment at this level is not only painful at a personal level, but is also a source of social tensions, which often threatens the whole fabric of society.

Industrial unemployment

There has been a large increase in the economically active population in the country, the economy has failed to grow at a pace to cope with the growth of the labour force. Population in urban areas has grown faster than in rural areas, because of the large scale migration from villages to cities. The industrial growth in India since Independence could not absorb all those who migrated to cities with the hope of getting some job or the other. The decay of cottage and small-scale rural industries has further contributed to the already bad employment situation in the countryside. In normal times some of the migrants get jobs in industries, some get absorbed in the unorganised, sector and the rest wait for their chance to get employment. Industrial unemployment has increased because of the slow industrialisation process and inappropriate technology…

Educated Unemployment

Educated unemployment is, by and large, a part of urban unemployment. It is a very serious and menacing problem, yet the size of educated unemployment remains largely unmeasured. Hence the quantitative base for analysing the problem of educated unemployment is weak. There are many causes of educated unemployment. The defective educational system, with its theoretical bias, lack of aptitude and technical qualifications for various types of work among jobseekers and maladjustments between demand and supply of educated workers are some well-known causes of educated unemployment. But the major cause of unemployment in this sector is the same which explains the overall unemployment in the country. Over the years, economic growth in India has been very slow.

Unemployment In Rural Areas

Seasonal unemployment

Seasonal unemployment in agriculture is a normal condition in India. This implies that farmers cultivating approximately 75 per cent of the land remain involuntarily unemployed for 4 to 6 months unless they find some temporary employment in this period. Since the percentage of the lucky ones who manage to get some work in the off-season is quite low, the incidence of seasonal unemployment in the agricultural sector is obviously very high. The Planning Commission in its ‘mid-term appraisal of the Fourth Plan’ had pointed out that leaving aside the green revolution belt, in all other areas seasonal unemployment during the early seventies was at least as much as during the fifties, if not more.

Disguised unemployment

Disguised unemployment is of a permanent nature. It refers to the hidden unemployment which is observed in India especially in the agricultural sector. In this form of unemployment people apparently seem to be employed though work is not available for all. For the past two and a half decades the demand for wage labour has increased in these areas and agricultural labourers have been brought from other parts of the country to meet it. In all other regions pressure of the growing population has been increasing on land and when one notices too many people operating tiny agricultural holdings, one feels cultural holdings, one feels inclined to believe that disguised unemployment still exists in these areas on a considerable scale.

Check out Economic development notes in detail. 

Causes For Unemployment

Slow growth process & rapid decline in employment

The size of employment in any country depends considerably on the level of development. In India, during the past three decades production has expanded in all the sectors of the economy. In response to these developments, the level of employment has also grown. But during the planning period, the rate of growth of employment was considerably lower than the targeted rate. Therefore, jobs inadequate number were not created. Further, economic growth by itself does not solve the problem of unemployment. The possibility of an increase in unemployment is not to be completely ruled out in a rapidly developing economy.,

Increase in the labour force

Since Independence, the death rate has rapidly declined and the country has entered the second stage of demographic transition. The rate of population growth rose to 2.2 per cent per annum during the 1960s, and, as a consequence, the rate of increase in the labour force also rose to 1.9 per cent per annum. Education among women has changed their attitude towards employment. Many of them now compete with men for jobs. The economy has, however, failed to respond to these challenges and the result is a continuous increase in unemployment backlog. Many people in villages having failed in getting a subsistence living in agriculture and allied activities are now migrating to cities where some of them are absorbed in productive activities and the rest join the reserve army of unemployed workers.

Inappropriate technology

In India, while capital is a scarce factor, labour is available in abundant quantity. Under these circumstances, if market forces operate freely and efficiently, the country would have labour-intensive techniques of production. However, not only in industries but also in agriculture producers are increasingly substituting capital for labour. In the western countries, where capital is in abundant supply, the use of automatic machines and other sophisticated equipment is both rational and justified while in India, on account of the abundance of labour, this. policy results in large unemployment.

Inappropriate educational system

The educational system in India is defective. It is, in fact, the same educational system that Lord Macaulay had introduced in this country during the colonial period. It is so because education in arts, commerce and science will not ensure employment to all those who have received it because of its limited utility. If the problem of unemployment is to be solved in this country, radical changes will have to be made in it. Any educational system which fails to develop human resources properly will not be able to employ all those who have received it.

Check out these notes on The Employment Policy And Special Employment Programs

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