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Unemployment in India

Unemployment in India

Many folks have faced unemployment in the past and present. What sets this type apart is the struggle to find full-time work. It happens when someone is searching for a job but can’t land one. The economic downturn since 2008 has made more people jobless. Unemployment comes in various forms, and the main culprits are the global economic slump, fancy technology, and the rise of automation.

What is Unemployment?

  • 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 labor force.
  • 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 constitute labour force and the unemployment rate is the percentage of the labour force that is without work.
  • Unemployment rate = (Unemployed Workers / Total labour force) × 100.

Types of Unemployment in India

Disguised Unemployment:
  • It is a phenomenon wherein more people are employed than actually needed.
  • It is primarily traced in the agricultural and unorganised sectors of India.
Seasonal Unemployment:
  • It is unemployment that occurs during certain seasons of the year.
  • Agricultural labourers in India rarely have worked throughout the year.
Structural Unemployment:
  • It is a category of unemployment arising from the mismatch between the jobs available in the market and the skills of the available workers in the market.
  • Many people in India do not get jobs due to a lack of requisite skills and due to poor education levels, it becomes difficult to train them.
Cyclical Unemployment:
  • It is a result of the business cycle, where unemployment rises during recessions and declines with economic growth.
  • Cyclical unemployment figures in India are negligible.
  • It is a phenomenon that is mostly found in capitalist economies.
Technological Unemployment:
  • It is the loss of jobs due to changes in technology.
  • In 2016, World Bank data predicted that the proportion of jobs threatened by automation in India is 69% year-on-year.
Frictional Unemployment:
  • Frictional Unemployment also called Search Unemployment, refers to the time lag between the jobs when an individual is searching for a new job or is switching between the jobs.
  • In other words, an employee requires time for searching for a new job or shifting from the existing to a new job, this inevitable time delay causes frictional unemployment.
  • It is often considered voluntary unemployment because it is not caused due to the shortage of jobs, but in fact, the workers themselves quit their jobs in search of better opportunities.
Vulnerable Employment:
  • This means, people, working informally, without proper job contracts and thus sans any legal protection.
  • These persons are deemed ‘unemployed’ since records of their work are never maintained.
  • It is one of the main types of unemployment in India.

Causes

Unemployment happens for different reasons. It can be because there aren’t enough job openings, the overall number of jobs is going down, more people are searching for work, or there’s a disconnect between the skills needed for jobs and the skills people have. Also, certain industries or places might feel the impact of unemployment more than others.

Impact The unemployment in any nation have the following effects on the economy:

    • Unemployment leads to poverty: When people don’t have jobs, they struggle financially, creating a cycle of poverty.
    • Government borrows more: With less production and spending, the government has to borrow more money to meet the economic gap caused by unemployment.
    • Rise in antisocial activities: Jobless individuals may be drawn towards antisocial elements, eroding faith in democratic values.
    • Increase in crime: Prolonged joblessness can push people towards illegal activities, contributing to a rise in overall crime rates.
    • Economic impact: joblessness burdens the economy, as people who could be contributing to it end up relying on others, leading to a decrease in GDP.
    • Socio-economic costs: The state faces increased socio-economic challenges due to a larger portion of the population being unemployed.
    • Statistical impact: Just a 1% rise in joblessness can result in a 2% reduction in the country’s GDP.
    • Social consequences: Joblessness often leads to issues like substance abuse, suicide attempts, causing a loss in human resources for the nation.

    Conclusion

    When folks don’t have jobs, it’s like a domino effect on the economy. First off, they have less cash to splash on stuff, which isn’t great news for businesses. Then there’s the government shelling out more on things like welfare to help those without jobs. Plus, when people are out of work, it can sometimes stir up trouble like more crime and social unrest. So, being jobless isn’t just a personal bummer; it sends ripples through the whole economic pond.

    Read Also: Job Creation: A Big Challenge

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