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 areas and in urban areas in India. 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 - - Theories of Employment and Income deficiency of effective demand. Cyclical unemployment can be cured by public investment or expansionary monetary policy. . Seasonal Unemployment This type of unemployment occurs during certain seasons of the year.
In agriculture and agro based industries like sugar industries, 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 (Temporary Unemployment) 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. When persons lose jobs and are in search of new jobs they have to wait for sometime.This period of joblessness is called frictional unemployment.
. Educated Unemployment Sometimes educated people are underemployed or unemployed when qualification does not match the job. Faulty education system, lack of employable skills, mass educated student turnout and preference for white collar jobs are highly responsible for educated unemployment in India. .
Technical Unemployment 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 thereby the existing workers are retrenched. Labour saving devices are responsible for technological unemployment. .
Structural 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 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 unemployed if his contribution to output is less than what he can produce by working for normal - - Theories of Employment and Income