Unemployment in india

Unemployment Problem
Types
Nature
Causes
Remedies

1. UNEMPLOYMENT IN INDIA Unemployment Problem Types Nature Causes Remedies 1 Jyoti Rastogi (Assistant Professor)

2. What is Unemployment ? Unemployment is a serious problem. It indicates a situation where the total number of jobs is much less than the total job seekers. It is a kind of situation where the unemployed persons do not find any meaningful or gainful job in spite of having willingness and capacity to work. Unemployment occurs when a person who is actively searching for employment is unable to find work. Unemployment is often used as a measure of the health of the economy. The most frequent measure of unemployment is the unemployment rate, which is the number of unemployed people divided by the number of people in the labour force. Jyoti Rastogi (Assistant Professor) 2

3. National Sample Survey Organization (NSSO )  defines employment and unemployment on the following activity statuses of an individual : Working (engaged in an economic activity) i.e. 'Employed'. Seeking or available for work i.e. 'Unemployed'. Neither seeking nor available for work . The first two constitutes labour force and unemployment rate is the percent of the labour force that is without work. Unemployment rate = (Unemployed Workers / Total labour force) × 100 Jyoti Rastogi (Assistant Professor) 3

4. Unemployment in India Unemployment is a common economic malady faced by each and every country of the world, irrespective of their economic system and the level of development achieved. But the nature of unemployment prevailing in underdeveloped or developing countries sharply differs to that of developed countries of the world . While the developed countries are facing unemployment, mostly of Keynesian involuntary and frictional types but the underdeveloped or developing countries like India are facing structural unemployment arising from high rate of growth of population and slow economic growth. Jyoti Rastogi (Assistant Professor) 4

5. Unemployment in India Structural unemployment may be open or disguised type. But the most serious type of unemployment from which those undeveloped countries like India are suffering includes its huge underemployment or disguised unemployment in the rural sector . India is one of those ill-fated underdeveloped countries which is suffering from a huge unemployment problem. But the unemployment problem in India is not the result of deficiency of effective demand in Keynesian term but a product of shortage of capital equipment’s and other complementary resources accompanied by high rate of growth of population. Jyoti Rastogi (Assistant Professor) 5

6. Measurement of Unemployment in India 6 Jyoti Rastogi (Assistant Professor) National Sample Survey Office (NSSO), an organization under Ministry of Statistics and Programme Implementation ( MSPI ) measures unemployment in India on following approaches: Usual Status Approach:  This approach estimates only those persons as unemployed who had  no gainful work for a major time during the 365 days  preceding the date of survey. Weekly Status Approach:  This approach records only those persons as unemployed who  did not have gainful work even for an hour on any day of the week  preceding the date of survey. Daily Status Approach:  Under this approach, unemployment status of a person is measured for each day in a reference week. A person having  no gainful work even for 1 hour in a day  is described as unemployed for that day.

7. Jyoti Rastogi (Assistant Professor) 7

8. Nature of Unemployment Problem in India Present unemployment problem in India is mostly structural in nature. Unemployment problem of the country can now be broadly classified into: Jyoti Rastogi (Assistant Professor) 8

9. Rural Unemployment Seasonal Unemployment : Agriculture, though a principal occupation in the rural areas of the country, is seasonal in nature. It cannot provide work to the rural population of the country throughout the year. In the absence of multiple cropping system and subsidiary occupation in the rural areas, a large number of rural population has to sit idle 5 to 7-months in a year . Seasonal Unemployment is also prevalent in some agro- based industries viz., Tea Industry, Jute Mills, Sugar Mills, Oil Pressing Mills, Paddy Husking Mills etc. Jyoti Rastogi (Assistant Professor) 9

10. Rural Unemployment Disguised or Perennial Unemployment : Indian agriculture is also suffering from disguised or perennial unemployment due to excessive pressure of population. In disguised unemployment apparently it seems that everyone is employed but in reality sufficient full time work is not available for all . In India, about 72 per cent of the working population is engaged in agriculture and allied activities. In 1951 more than 100 million persons were engaged in the agricultural and allied activities whereas in 1991 about 160 million persons are found engaged in the same sector resulting in as many as 60 million surplus population who are left with virtually no work in agriculture and allied activities. Jyoti Rastogi (Assistant Professor) 10

11. Urban Unemployment Industrial Unemployment: In the urban areas of the country, industrial unemployment is gradually becoming acute. With the increase in the size of urban population and with the exodus of population in large number from rural to the urban industrial areas to seek employment, industrialization because of slow growth could not provide sufficient employment opportunities to the growing number of urban population . Thus the rate of growth of employment in the industrial sector could not keep pace with the growth of urban industrial workers leading to a huge industrial unemployment in the country. Jyoti Rastogi (Assistant Professor) 11

12. Urban Unemployment Educated or middle-class Unemployment : Another distinct type of unemployment which is mostly common in almost all the urban areas of the country is known as educated unemployment. This problem is very much acute among the middle class people. With rapid expansion of general education in the country the number of out-turn of educated people is increasing day by day. But due to slow growth of technical and vocational educational facilities, a huge number of manpower is unnecessarily diverted towards general education leading to a peculiar educated unemployment problem in the country. Jyoti Rastogi (Assistant Professor) 12

13. Causes of Unemployment Large population. Low or no educational levels and vocational skills of working population. Inadequate state support, legal complexities and low infrastructural, financial and market linkages to small/ cottage industries or small businesses, making such enterprises unviable with cost and compliance overruns. Huge workforce associated with informal sector due to lack of required education/ skills, which is not captured in any employment data. For ex: domestic helpers, construction workers etc. The syllabus taught in schools and colleges, being not as per the current requirements of the industries.  This is the main cause of structural unemployment. Inadequate growth of infrastructure and  low investments in manufacturing sector, hence restricting employment potential of secondary sector . Low productivity in agriculture sector combined with lack of alternative opportunities for agricultural worker which makes transition from primary to secondary and tertiary sectors difficult. Regressive social norms  that deter women from taking/continuing employment. Jyoti Rastogi (Assistant Professor) 13

14. Impact of Unemployment The problem of unemployment gives rise to the  problem of poverty . Young people after a long time of unemployment indulge in illegal and wrong activities for earning money. This also leads to  increase in crime in the country . Unemployed persons can easily be enticed by antisocial elements.  This makes them lose faith in democratic values of the country. It is often seen that unemployed people end up getting addicted to drugs and alcohol or attempts suicide, leading losses to the  human resources of the country . It also affects  economy  of the country as the workforce that could have been gainfully employed to generate resources actually gets dependent on the remaining working population, thus  escalating socioeconomic costs  for the State. For instance, 1 percent increase in unemployment reduces the GDP by 2 percent Jyoti Rastogi (Assistant Professor) 14

15. Remedies to Rural Unemployment Problem Jyoti Rastogi (Assistant Professor) 15

16. Remedies to Urban Unemployment Problem Jyoti Rastogi (Assistant Professor) 16

17. THANKS 17 Jyoti Rastogi (Assistant Professor)