GSEB Class 12 Economics Solutions Chapter 6 Unemployment

1. Choose the correct option for the following questions:

 

Question 1. A person is capable, willing and ready to work at current wage rate is said to be
(A) Unemployed
(B) Poor
(C) Surplus
(D) Worker
Answer: (A) Unemployed
In simple words: Someone who can work, wants to work, and is looking for a job at the normal pay rate but cannot find one is considered unemployed.

Exam Tip: Understand the precise definition of 'unemployed' which includes capability, willingness, and readiness to work at the prevailing wage. This differs from 'poor' or simply being a 'worker'.

 

Question 2. Compulsory nature of unemployment is seen in which context of labour supply?
(A) Active
(B) Passive
(C) Children
(D) Elders
Answer: (A) Active
In simple words: When people are actively seeking work but cannot find it, this indicates compulsory unemployment within the active labor force.

Exam Tip: Compulsory unemployment applies to the 'active' labor force, meaning those who are able and willing to work but are unable to find jobs, distinguishing them from 'passive' or non-working groups like children or elders.

 

Question 3. Who presented four measuring roads of measuring types of unemployment?
(A) Raj Krishna
(B) Mahalnobis
(C) Keynes
(D) Rodan
Answer: (A) Raj Krishna
In simple words: Raj Krishna introduced four main ways to measure different types of unemployment.

Exam Tip: Remember the key economists associated with major economic concepts. Raj Krishna's name is crucial for the four measures of unemployment.

 

Question 4. Which type of unemployment arises due to lack of effective demand?
(A) Frictional
(B) Seasonal
(C) Cyclical
(D) Disguised
Answer: (C) Cyclical
In simple words: Unemployment caused by a general decrease in spending and economic activity is called cyclical unemployment.

Exam Tip: Cyclical unemployment is directly linked to business cycles and overall economic demand. Frictional, seasonal, and disguised unemployment have different underlying causes.

 

Question 5. Which type of production technique increase unemployment?
(A) Labour intensive
(B) Capital intensive
(C) Agriculture oriented
(D) Education oriented
Answer: (B) Capital intensive
In simple words: Using many machines and little human labor in production can lead to more people being unemployed.

Exam Tip: Capital-intensive techniques rely heavily on machinery and technology, which can displace human labor, thus increasing unemployment, especially in economies with a large labor force.

 

2. Answer the following questions in one line:

 

Question 1. Explain meaning of unemployment.
Answer: Unemployment is a situation where a person is willing and capable of working at the current wage rate but does not get work. It describes the condition of individuals actively seeking jobs who are unable to find employment.

Exam Tip: When defining unemployment, ensure you include the key elements: willingness to work, capability, and the inability to find a job at the prevailing wage rate.

 

Question 2. Which type of unemployment is seen in developed nations?
Answer: Cyclical and frictional unemployment are typically observed in developed nations. These types of joblessness occur for different reasons specific to more advanced economies.

Exam Tip: Differentiate between types of unemployment and where they are most prevalent. Developed economies often face cyclical (due to economic downturns) and frictional (due to job transitions) unemployment.

 

Question 3. Define disguised unemployment.
Answer: Disguised unemployment occurs when more people than necessary are employed in a task, and removing some of them would not change the total production. This means the extra workers are not adding to output.

Exam Tip: The core concept of disguised unemployment is that the marginal productivity of additional workers in a sector (like agriculture) is zero or very low.

 

Question 4. Which depression is called world's great depression?
Answer: The economic downturn experienced by America during 1929-30 is called the world's great depression. It got this name because many countries across the globe felt its significant impact.

Exam Tip: Identify key historical economic events by their correct names and significant years. The "Great Depression" is a major milestone in economic history.

 

Question 5. From where is information regarding extent of unemployment in India is obtained?
Answer: In India, data regarding unemployment can be gathered from the Planning Commission, Central Statistical Organization, National Sample Survey, employment exchange reports, and the Bhagwati Committee Report.

Exam Tip: List official government and committee sources when asked about data collection in India. Knowing these bodies is important for understanding economic reporting.

 

Question 6. Which age group is called the productive age group?
Answer: The age group from 15-64 years is generally considered the productive age group. This range includes individuals who are typically able to work and contribute to the economy.

Exam Tip: The productive age group is standard demographic data, typically defined as 15-64 years, representing the working-age population.

 

Question 7. Which industries should develop to solve the problem of unemployment?
Answer: To help solve the problem of unemployment, cottage and small-scale industries should be developed. These sectors often require less capital and can create many job opportunities.

Exam Tip: Cottage and small-scale industries are often highlighted for their potential to generate employment, especially in developing economies, due to their lower capital requirements.

 

Question 8. Which slogan is given by Prime Minister Agricultural Irrigation scheme?
Answer: The slogan given by the Prime Minister Agricultural Irrigation scheme is “Water to every field”. This motto highlights the goal of providing water for farming to all areas.

Exam Tip: Be precise with slogans and quotes from government schemes. "Water to every field" summarizes the scheme's main purpose.

 

Question 9. When was "Pandit Deendayal Upadhyay Shramev Jayate Yojana" started?
Answer: The "Pandit Deendayal Upadhyay Shramev Jayate Yojana" was started on 16th October, 2014. This date marks the beginning of this important government initiative.

Exam Tip: Exact dates are important for schemes and policies. Note down the start date for government initiatives.

 

3. Answer the following questions in brief:

 

Question 1. Explain meaning of unemployment.
Answer: People who are ready and able to work at the current wage rate and also possess the necessary qualifications but do not get any job are called "fully unemployed or openly unemployed." Generally, this type of joblessness is common in countries where labor supply and urbanization happen very quickly. Nations where both the labor supply and city growth rise rapidly often experience high rates of complete unemployment. This kind of unemployment is more frequently seen in towns than in villages, as many openly unemployed individuals migrate from villages to cities looking for work. Those suffering from open unemployment can be either educated or less skilled persons. Although openly unemployed individuals do not get work, they still consume goods and spend money, becoming a burden and a cause of low productivity. This type of joblessness is frequently observed among people aged 15 to 25 years. It is difficult to count the exact number of openly unemployed people, but there are three ways to do this: by getting the number of people registered at employment exchange centers, through sample surveys of the labor supply, and through a Census.
In simple words: Open unemployment means when people who are ready, skilled, and willing to work at the usual pay cannot find any job. This is common where many people move to cities and look for jobs, making it hard to find work even if they are educated. We count them using employment records or surveys.

Exam Tip: Provide a clear definition and then elaborate on its characteristics, prevalence, and methods of measurement for a comprehensive answer.

 

Question 2. Explain frictional unemployment with example.
Answer: Frictional unemployment is the joblessness that happens during the time a worker is looking for a new job or moving from one job to another. The word 'frictional' is used because labor markets do not instantly match job demand with supply, creating a "friction" between the two. This type of joblessness is usually short-term. It can also arise in the production process because of changes in demand, taste, new technology, or new products entering the market. In developed countries, when an old production system is replaced by a new one, businesses with the old system suffer losses and close down. As a result, workers in these units stay unemployed until they learn the new technology. For instance, when smartphones replaced old mobile phones, the workers involved in producing, selling, and servicing mobile phones became temporarily unemployed.
In simple words: Frictional unemployment is temporary joblessness when people are between jobs or looking for new ones. It happens because it takes time for workers to find the right new job. For example, a factory worker might be out of a job while learning new skills for a modern machine.

Exam Tip: Define frictional unemployment clearly, emphasize its temporary nature, and provide a relevant, easy-to-understand example to illustrate the concept.

 

Question 3. "The problem of unemployment is because of low savings and investment in India.” Explain in brief.
Answer: Low rate of savings and investments is a key reason for unemployment in India. Even though national income grew during the planning periods, the population also increased rapidly. As a result, the per capita national income grew at a slower pace compared to the overall national income. Due to low per capita income and the need to cover basic necessities for a large population, India’s savings and investment levels remained low. Therefore, India could not make adequate investment in crucial sectors like industry, agriculture, or other services. This limited investment meant fewer job opportunities could be created, making unemployment a persistent challenge.
In simple words: India has a problem with unemployment because people save and invest too little. Even though the country's income has grown, the population also grew fast, leaving less money per person. This low income means fewer savings and investments, which then leads to fewer new jobs being created.

Exam Tip: Connect low savings and investment to low capital formation, which directly impacts job creation capacity. Explain the chain reaction from population growth to per capita income and then to investment.

 

Question 4. "Labour-intensive technique is more applicable for India." Explain.
Answer: In India, land and capital are scarce resources, while labor is abundant. The population grows quickly, meaning the labor supply constantly increases. However, job opportunities do not grow at the same speed, leaving a large number of people without work. In this situation, India should adopt labor-intensive production techniques to create employment on a large scale. When the Bhagwati Committee and Venkataraman Committee were formed to study unemployment, they also suggested using less mechanization and favoring labor-intensive techniques. Industries such as consumer goods, small and medium-scale industries, business and trade, animal husbandry, and dairy development have great potential to employ many laborers, unlike large mechanized industries. Hence, labor-intensive techniques are more suitable for India's economic conditions.
In simple words: India has many people but not much land or money for big machines. So, using production methods that employ more people and fewer machines is better here. Committees have also suggested this, as industries like farming and small businesses can hire many workers.

Exam Tip: Emphasize India's resource endowment (abundant labor, scarce capital) to justify the preference for labor-intensive techniques and mention specific sectors where this approach is effective.

 

Question 5. Which scheme was started to provide continuous electricity service in rural area? Explain it.
Answer: The Deendayal Upadhyay Gramjyoti Yojna (DUGJY) was launched with the goal of providing continuous 24x7 electricity service in rural areas. This program was introduced to replace the earlier Rural Electrification program and ensure that villages have reliable power supply for their development. It aims to improve the quality of life and boost economic activities in rural regions through uninterrupted electricity.
In simple words: The Deendayal Upadhyay Gramjyoti Yojna (DUGJY) was started to give villages 24/7 electricity. It replaced an older program to make sure rural areas have constant power for life and work.

Exam Tip: Identify the correct scheme and its primary objective. Mentioning its predecessor adds context and shows a deeper understanding of government initiatives.

 

Question 6. When and with what objective Prime Minister Irrigation scheme was started?
Answer: The Prime Minister Agricultural Irrigation Programme was started on 1st July, 2015. Its main goal was "Water to every field," aiming to enhance field productivity and make the best use of available water resources. The program also focused on planning irrigation facilities in agricultural areas to support farming and ensure better harvests.
In simple words: The Prime Minister's Agricultural Irrigation Programme began on July 1, 2015. It aimed to provide "Water to every field" to improve farm output by using water resources wisely and planning irrigation better.

Exam Tip: State the launch date and key objectives, especially any specific slogans associated with the scheme. Connecting it to agricultural productivity is crucial.

 

Question 7. Speed and expansion of green revolution can solve the problem of unemployment.” Explain.
Answer: Due to rapid population growth in India, many people depend on agriculture for employment, even when many could be removed without affecting agricultural productivity; this is disguised unemployment. Also, unreliable monsoons and insufficient irrigation create seasonal unemployment. To solve unemployment in rural areas, the green revolution should be expanded rapidly to all rural regions. Key supportive activities like minor and major irrigation, soil conservation, mixed farming, forest development, and harvest planning must be done. Furthermore, efforts should focus on getting more than one crop per year from the land, modernizing agriculture, and emphasizing agro-based rural industries to increase jobs. If these steps are implemented, the green revolution can significantly help in reducing unemployment.
In simple words: India has many hidden unemployed people in farming because too many rely on it. Expanding the green revolution with better irrigation, modern farming, and rural industries can create more jobs and help solve this problem.

Exam Tip: Explain how current agricultural issues contribute to unemployment. Then detail the specific actions that, through the green revolution, can create new jobs and tackle both disguised and seasonal unemployment.

 

Question 8. Give the information about Mahatma Gandhi National Rural Employment Programme.
Answer: Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA):

• In February 2006, the National Rural Employment Guarantee Act (NREGA) began, aiming to give work to country people in less developed regions.
• On October 2nd, 2009, the program's name changed to the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
• To ensure this initiative worked well, the government announced February 2nd as "Employment Day”.
• This program aimed to build useful things through community projects and give work to at least one person from each poor rural and city family for a minimum of 100 days a year.
• In this plan, one-third of all available jobs were kept aside for women.
• According to this law, anyone asking for work would get a job within 15 days, usually within 5 km. If workers had to travel further, they would receive 10% more pay for travel costs.
• Workers doing manual jobs get at least a basic wage for their efforts.
• Workers in this program get job cards that last for five years. If they don't find work after getting a card, they receive unemployment benefits.

In simple words: The MGNREGA program started in 2006 to provide 100 days of work each year to rural and urban poor. It also reserves one-third of jobs for women and offers unemployment benefits if work is not found.

Exam Tip: When describing government schemes, always include the full name, the launch date, and 2-3 key objectives or features for a comprehensive answer.

 

5. Answer the following questions in detail :

 

Question 1. What are the reasons of unemployment? Describe any five in detail.
Answer: Reasons and unemployment:
1. High rate of population growth:

• India is a densely populated nation with a fast-rising population, which steadily adds to its numbers.
• This growing population constantly provides many workers who are always looking for jobs. However, job openings do not grow at the same speed.
• One calculation suggests that India's population grows by 1.70 crores each year, which is more than Australia's entire population.

2. Slow rise in employment opportunities:

• More jobs and economic progress are closely connected.
• During planning times, the economy kept growing, but we could not make enough job openings. So, economic growth happened without creating many new jobs.
• In the first ten years of planning, India reached 3.5 percent economic growth. This rate grew to 7.6% in the 10th five-year plan and 7.8% in the 11th five-year plan. We were unable to boost jobs enough to match this expansion.
• Also, the green revolution in farming stayed only in some places. Other parts of the economy grew slowly. This caused joblessness to rise in those other areas.

3. Low rate of savings and investments:

• Even though national income went up during planning years, population also grew quickly. Because of this, the average income per person grew slower than the overall national income.
• Due to low income per person and the costs needed to supply basic needs to many people, India's savings and investments stayed low.

Hence, India could not put enough money into industry, farming, or other areas, and thus failed to generate many jobs.
4. Capital intensive production technique:

• In India, land is limited, while workers are plentiful.
• In this situation, India should have used production methods that require many workers to provide jobs for many people. However, starting from the second five-year plan, India concentrated on building large, essential industries that use more capital than labour.
• Even during planning, India prioritized production methods that use a lot of capital instead of those that use many workers.
• Using machines became more important in both factories and farms.
• So, despite India's economy expanding, many people still lacked jobs.

5. Lack of vocational training:

• A key cause of increasing joblessness is a poor education system.
• India's schooling system cannot create workers who fit the changing demands and approaches of the job market.
• To gain fast economic growth, India embraced modern methods in industries and agriculture but did not develop workers with the right knowledge and abilities to keep pace with these changes.
• India offered no job-specific training to help workers adjust to new technologies, which led to more people being jobless.

6. Lack of manpower planning:

• India has not managed its human resources or workforce planning well.
• India did not successfully plan what kind of workers, how many, and what education or training would be needed to match future demands.
• Consequently, even though many educated young people get degrees each year, they often lack the particular skills and training needed for today's jobs. This means they are educated but jobless.
• Often, because of few job chances, highly qualified doctors and engineers move to other nations as they cannot find appropriate work in India.

7. Inefficiency of public sector:

• After India gained freedom, government-run businesses received more attention than private ones. This led to a huge increase in funding to boost the number of state-owned companies.
• The government sector turned out to be quite inefficient. Because of this, it could not create enough jobs.
• To help the public sector expand, many rules were placed on private businesses, even though they could create many jobs. Additionally, the government overlooked the growth of the private sector, which greatly harmed job creation.

8. Negligence towards agriculture sector:

• India is a farming country, with most people living in villages. These individuals naturally rely on agriculture for their jobs.
• During the planning years, India overlooked farming and focused more on other parts of the economy. Agriculture did not develop enough, leading to widespread joblessness.
• Even though India saw a Green Revolution in farming, its advantages were limited to just a few states, such as Punjab and Haryana.
• Furthermore, the pressure of population, insufficient irrigation, limited farm funding, uncertain rains, and other issues led to farming's poor growth.

9. Poor development of agriculture
9. Low mobility of labourers:

• Limited movement of workers is also a cause of joblessness.
• Often, workers don't relocate for jobs because of social issues, family ties, language differences, religious and cultural limits, caste, poor information, no transport, or trouble finding suitable homes. These individuals then end up with too little work or no work at all.
• Highly educated people don't want to work in villages or less developed regions. They hope to find jobs in cities, and if they don't, they stay jobless.
• The appeal of city living, modern services, and amenities keeps people from seeking jobs in villages.

10. Lack of infrastructural facilities:

• Villages do not have good transport, roads, schools, medical care, and power.
• Conversely, in villages, workers are readily available at low pay, land is cheaper, and raw materials for farm-based businesses are easy to get. Yet, because of poor basic services, business owners do not want to set up factories there. As a result, joblessness remains an issue in villages.

11. Other reasons: Lack of a clear national job plan, good working conditions, a favorable setting for business and trade growth, and not fully using natural resources are some other causes leading to more joblessness.
In simple words: Unemployment in India stems from many factors like a rapidly growing population, slow creation of new jobs, low savings, and too much focus on machine-heavy industries. It also results from a poor education system that doesn't provide job-specific skills, weak manpower planning, and the inefficiency of public sector jobs. Furthermore, the neglect of agriculture, limited worker mobility, and poor basic facilities in rural areas also contribute significantly to the problem.

Exam Tip: When detailing reasons for a complex issue like unemployment, categorize your points (e.g., demographic, economic, social, educational) and use clear headings to make your answer structured and easy to follow. Provide a brief explanation for each reason.

 

Question 2. What are the measures to solve the problem of unemployment? Explain any five in detail.
Answer: Measures to reduce unemployment:
The next actions must be taken to fix the issue of joblessness:
1. Population control:

• India's rapid population growth has worsened the issue of joblessness and made it more severe.
• The quickly growing population continuously adds workers to the job market. These workers then seek employment from the economy.

Solution for population control:

• Strong actions must be taken to manage population numbers.
• This will cut down on the number of available workers in the long run, thereby helping to fix the unemployment problem.

2. Increase in rate of economic development:

• In the early years of planning, economic growth was around 3 to 3.5%. This pace later went up.
• Boosting economic progress helps to handle joblessness. Solution for economic development:
• To get fast economic growth, different parts of the economy need to work together closely and in an organized way.
• Attempts must be made to put more money into public, private, and cooperative businesses.

3. Employment oriented planning: During the initial years of planning, the government focused more on economic growth. This meant prioritizing the development of major industries within the public sector. Now, the requirements are different.
Solution for employment-oriented planning:

• Currently, we should particularly focus on plans that create jobs.
• For this purpose, India is already supporting job-creating sectors like consumer goods, industries needing many workers, small and medium businesses, trade, animal farming, and dairy development.
• This action will boost the output of consumer items, create jobs, and bring financial steadiness.

4. Employment Oriented Education:

• The current school system causes joblessness. It only gives theoretical knowledge and trains people mostly for clerical jobs.
• These people stay jobless for extended periods.

Solution for employment-oriented education:

• Students should receive practical education in fields like trade, business, farming, and other areas.
• It is important to add more subjects to the school plan that include training and practical business knowledge in trade, commerce, farming, and factories. This way, after finishing their studies, it will be simpler for them to find jobs.
• In its 2015 education plan, the government decided to work with businesses to offer practical education to learners.

5. Development of cottage and small scale industries: Small and home-based businesses can create jobs, even with basic skills and little money.
Solution for cottage and small scale industries:

• These small and home-based businesses need plenty of help and backing to grow.
• India has limited capital but many workers. Therefore, growing small and home-based industries should be seen as the best choice, and special efforts must be made for their progress.
• Actions such as setting aside the making of some items for small industries, and giving money, technical advice, and management help from the government, are some ways to develop and support these businesses.

6. Extending infrastructural facilities: It is clear that India's villages have fewer job openings than its cities. A main cause of this is the lack of proper basic services in rural areas.
Solution for extending infrastructural facilities:

• The government should try to expand basic services such as schools, hospitals, homes, electricity, roads, and technical training centers in villages. This way, people living in rural areas can find jobs close to their homes.
• Building more basic services will create new job chances. Additionally, it will help in creating jobs in farming and related fields.

7. Speed and expansion of green revolution in agricultural sector:

• Because of India's rapid population increase, many people rely on farming for work, even when a lot of them could find jobs elsewhere without harming farm output. This shows there is hidden joblessness in India's agricultural sector.
• Also, unreliable rain and poor watering systems cause temporary joblessness.

Solution for green revolution expansion:

• To fix joblessness in villages, the green revolution needs to move faster, and efforts must be made to spread it across all rural regions.
• If managed correctly, farming can offer more jobs than any other part of the economy.
• To bring the green revolution to all villages, important supporting tasks like small and large irrigation, protecting soil, mixed farming, growing forests, and planning for bigger harvests should be carried out.
• Furthermore, efforts should focus on getting multiple crops from the land each year, updating farming methods, and emphasizing rural farm-based businesses to boost job creation.

In simple words: To tackle unemployment, India needs a multi-pronged approach including effective population control and faster economic growth. It also requires planning focused on creating jobs, reforming education to be more skill-based, and promoting small-scale industries. Additionally, improving basic facilities in rural areas and accelerating the Green Revolution are crucial steps.

Exam Tip: When discussing solutions, ensure you explain *how* each measure helps to solve the problem, connecting it back to the causes of unemployment. Providing a "solution" section for each measure makes the answer clear and logical.

 

Question 3. Explain any three schemes introduced to solve the problem of unemployment.
Answer: Here are some of the plans the government started to fix joblessness:
1. Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA):

• In February 2006, the National Rural Employment Guarantee Act (NREGA) began, aiming to give work to country people in less developed regions.
• On October 2nd, 2009, the program's name changed to the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
• To ensure this initiative worked well, the government announced February 2nd as "Employment Day”.
• This program aimed to build useful things through community projects and give work to at least one person from each poor rural and city family for a minimum of 100 days a year.
• In this plan, one-third of all available jobs were kept aside for women.
• According to this law, anyone asking for work would get a job within 15 days, usually within 5 km. If workers had to travel further, they would receive 10% more pay for travel costs.
• Workers doing manual jobs get at least a basic wage for their efforts.
• Workers in this program get job cards that last for five years. If they don't find work after getting a card, they receive unemployment benefits.

2. Pandit Deendayal Upadhyay Shramev Jayate Yojna (PDUSJY):

• This plan began on October 16th, 2014.
• The main goal of this program was to offer workers in the informal sector health and safety, along with good administration, skill building, and worker support.
• The program also seeks to create a good environment for factory growth.

3. Deendayal Upadhyay Gramjyoti Yojna (DUGJY): This program aims to provide continuous 24/7 electricity service in villages. This initiative was launched to replace the previous Rural Electrification program.
4. Deendayal Upadhyay Gramin Kaushalaya Yojna (DUGKY):

• This plan began on September 25th, 2014.
• The main goal of this program was to offer jobs to young people aged 18 to 35.

5. Prime Minister Agricultural litigation Programme:

• This program began on July 1st, 2015, with the goal of bringing “Water to every field”
• The program works to boost farm output, use existing resources in the best way, and plan for watering systems in farming areas.

In simple words: The government has rolled out several schemes like MGNREGA to ensure work for rural poor and provide social security. PDUSJY focuses on informal sector workers' welfare and skill development. DUGJY aims to supply constant electricity to villages, and DUGKY seeks to create jobs for youth. The Prime Minister's Agricultural scheme promotes better farm productivity and irrigation.

Exam Tip: When asked to explain government schemes, remember to include the full name of the scheme, its launch date, and its primary objective to demonstrate comprehensive knowledge.