Maharashtra Board Class 11 Economics Chapter 7 Unemployment In India PDF Download

Chapter 7: Unemployment In India

Introduction

India is a developing economy and one of the fastest growing economies of the world. The problem of unemployment is considered to be the biggest challenge to the development of India.

Unemployment leads to a waste of human resources. Long term unemployment results in mass poverty and slow economic development. Mostly, young people face the problem of unemployment.

Young people are a major human resource, key agents for social change and driving force for economic development and technological innovation. India has considerable young population hence unemployment among youth is the most critical challenge of the 21st century.

There is an imbalance between employment opportunities and increase in population. This has resulted in large scale unemployment. So generally unemployed people are involved in unproductive work like gambling and indulge in anti-social and anti-national activities.

Teacher's Note

Many people in villages do not have steady jobs. Even when they have work, it is only for a few months in the year.

Exam Trick

Remember: Unemployment means a person is able and willing to work but cannot find a job. It is not the same as being lazy.

Points to Remember

Unemployment means a person wants to work but has no job.
Young people face more unemployment problems than older people.
Unemployment wastes human resources and money.
When unemployment is high, more people become poor.
Unemployment can lead to social problems and crime.

Meaning of Unemployment

Normally anyone who is not gainfully employed in any productive activity is said to be unemployed.

In economics, unemployment is to be studied with respect to:

a) nature

b) working age group

c) demand for and supply of labour

d) prevailing wage rate

The rate of economic growth is not fast enough to generate adequate jobs to absorb the expanding labour force.

Unemployment is a situation in which people in the age group of 15 to 59 years are able and willing to work at the prevailing wage but unable to get a job.

For a person to be considered employed, it is essential that the person should be engaged in work for a minimum number of hours per week. According to National Sample Survey Organization (N.S.S.O.):

i) In India, a person is considered unemployed if he works for less than fourteen hours per week.

ii) Those who work for 15 - 28 hours a week are considered as underemployed.

iii) Person working for eight hours per day i.e. 273 days of the year is considered employed on a standard basis.

Teacher's Note

In India, the government has a rule that says if you work less than 14 hours in a week, you are called unemployed. This is like how Aadhaar marks you as registered only when all your information is complete.

Exam Trick

Remember: Less than 14 hours work per week = Unemployed. 15 to 28 hours per week = Underemployed. 8 hours per day for 273 days per year = Employed.

Points to Remember

A person must be between 15 and 59 years old to be counted as unemployed.
Working less than 14 hours per week means you are unemployed.
Working 15 to 28 hours per week means you are underemployed.
Employment means working at least 8 hours per day for most days of the year.
The government uses these rules to count how many people are unemployed.

You Should Know

1) Involuntary unemployment: It refers to a situation in which people are willing to work, but there is no work for them due to excess of labour force in relation to demand for labour.

2) Voluntary unemployment: It is a type of self unemployment where a person is fit to work but not willing to work.

3) Underemployment: It is a situation where a person's capacity to work is under utilised.

4) Full employment: It is a hypothetical situation in which all available resources are being used in the most efficient manner.

Teacher's Note

Sometimes people do not want to work even when jobs are available. This is like a student who refuses to study even when a teacher is ready to teach.

Exam Trick

Remember: Involuntary = No jobs available (sad). Voluntary = Does not want job (choice). Underemployment = Working part-time when you can work full-time.

Points to Remember

Involuntary unemployment means jobs are not available even though people want to work.
Voluntary unemployment means a person can work but chooses not to.
Underemployment means a person works less than they could work.
Full employment is when everyone who wants to work has a job.
These four types help us understand different unemployment situations.

Types of Unemployment

There are various types of unemployment. We can classify unemployment into various categories.

Unemployment can be divided into two main types: Rural unemployment and Urban unemployment.

A) Rural Unemployment

The unemployment found in villages is called rural unemployment. Following are the types of rural unemployment:

1) Seasonal Unemployment

A large number of people remain unemployed during the slack season or in the off season. Agriculture being a seasonal occupation, farmers have to depend upon monsoon for cultivation.

Majority of the labour force in the agricultural sector remain unemployed for nearly 5-7 months in a year. Seasonal unemployment is also found in tourism, marriage bands, sugar factories, ice factory, fisheries etc.

2) Disguised Unemployment

It is also known as invisible unemployment. Disguised unemployment is generally found in villages in India.

It is a situation in which more people are doing work than actually required. Even if some are withdrawn, production does not suffer. In other words it refers to a situation of employment with surplus manpower in which some workers have zero marginal productivity.

The excessive pressure on land leads to disguised unemployment in rural areas. It is estimated that nearly 20% of the labour force is disguisedly unemployed in rural areas.

Joint family system, lack of alternative job opportunities result in overcrowding in agriculture. These are the main reasons for disguised unemployment.

Teacher's Note

In villages, many family members work on the same farm even though only a few are needed. If some leave, the farm still produces the same amount of food. This is like having 10 teachers in a classroom where only 3 are needed.

Exam Trick

Remember: Disguised = Hidden unemployment. Extra workers produce nothing extra. It is common in villages where families share farm work.

Points to Remember

Seasonal unemployment happens in farming when there is no work for some months.
Tourism and fishing businesses also have seasonal unemployment.
Disguised unemployment means extra workers are not really needed.
About 20% of village workers face disguised unemployment in India.
Joint families on farms lead to disguised unemployment.

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