7.9 UNEMPLOYMENT

Concept of Unemployment and Unemployed:

Unemployment happens when people who want to work can’t find a job to earn a living. According to the NSSO, unemployment includes those who are actively looking for work but can’t find any through various channels.

Types of Unemployment:

• Open Unemployment:
  • This occurs when someone is willing and able to work but can’t find any job, whether part-time or full-time.
• Frictional Unemployment:
  • This is temporary unemployment when people are between jobs or due to strikes.
• Structural Unemployment:
  • Caused by a reduced demand for a specific product or industry, leading to a drop in jobs.
• Cyclical Unemployment:
  • Connected to economic cycles, like recessions, causing a decrease in demand, production, and jobs.
• Seasonal Unemployment:
  • Happens in seasonal jobs like agriculture, where there’s work only during specific times of the year.
• Disguised Unemployment:
  • This occurs when more people are working than needed, leading to zero or negative productivity.

Types of Unemployment in India:

• Rural Unemployment:
  • In rural areas, people may struggle to find work due to factors like dependence on rainfall and outdated farming methods.
• Urban Unemployment:
  • In cities, joblessness affects millions, creating frustration and a sense of not being needed.
• Subtypes in Rural Unemployment:
  • Open Unemployment:
    • Landless workers looking for work but can’t find regular income.
  • Seasonal Unemployment:
    • Farmers remain unemployed for several months each year due to unirrigated land.
  • Disguised Unemployment:
    • Excess labor in farming, leading to reduced productivity.
• Subtypes in Urban Unemployment:
  • Industrial Unemployment:
    • Lack of jobs for industrial labor due to slow growth.
  • Educated Unemployment:
    • Urban educated individuals face joblessness despite increased education opportunities.
  • Technological Unemployment:
    • People without updated skills in new technology face job loss.

Measurement of Unemployment:

Unemployment data comes from the Census of India, the National Sample Survey Organisation, and the Directorate General of Employment and Training. The current unemployment rate is around 2.2%.

Causes of Unemployment in India:

• Faulty Employment Planning:
  • The Five-Year Plans didn’t focus on generating employment.
• Emphasis on Capital-Intensive Projects:
  • Use of machines in a labor surplus economy led to more unemployment.
• Excessive Use of Foreign Technology:
  • Reliance on foreign technology resulted in technical unemployment.
• Lack of Financial Resources:
  • Agriculture and small-scale industries suffered due to insufficient funds.
• Slow Growth Process:
  • Although the economy grew, job opportunities didn’t keep up.
• Increase in Labour Force:
  • A growing population added more young people seeking jobs.
• Decay of Cottage and Small Scale Industries:
  • The decline of small industries and the emergence of large ones didn’t create enough jobs.

Objective Type Questions

1. What is unemployment?
   A. A situation where people have too many jobs
   B. A situation where people can’t find jobs for a living
   C. A situation where people work part-time only
   D. A situation where people are not willing to work
   Answer: B
2. How does the NSSO define unemployment?
   A. People not seeking work
   B. People actively looking for work but unable to find any
   C. People working casually
   D. People working full-time
   Answer: B
3. What is open unemployment?
   A. Temporary unemployment between jobs
   B. Unemployment due to a drop in demand for a specific product
   C. Situation where a person is willing to work but can’t find any
   D. Unemployment due to strikes or lockouts
   Answer: C
4. When does frictional unemployment occur?
   A. During economic cycles
   B. When workers are temporarily out of work while changing jobs
   C. Due to lack of rainfall
   D. In seasonal jobs
   Answer: B
5. What is structural unemployment caused by?
   A. Temporary factors like strikes
   B. Changes in demand for a product in a particular industry
   C. Economic cycles
   D. Seasonal changes
   Answer: B
6. What is the characteristic of disguised unemployment?
   A. Apparent employment with zero or negative productivity
   B. Temporary unemployment between jobs
   C. Permanent unemployment
   D. Unemployment due to strikes
   Answer: A
7. In rural areas, what is the primary source of livelihood for most people?
   A. Seasonal employment
   B. Industrial jobs
   C. Agriculture
   D. Casual jobs
   Answer: C
8. What is urban unemployment in India categorized into?
   A. Open, structural, and cyclical
   B. Industrial, seasonal, and disguised
   C. Rural and urban
   D. Frictional, technological, and educated
   Answer: B
9. What is the primary cause of industrial unemployment in urban areas?
   A. Lack of jobs for industrial labor due to slow growth
   B. Seasonal changes
   C. Increased education opportunities
   D. Population growth
   Answer: A
10. What is the focus of the Five-Year Plans in India regarding unemployment?
    A. Employment generation
    B. Industrial growth
    C. Capital-intensive projects
    D. Rural development
    Answer: C
11. What does a slow growth process in a country lead to in terms of employment?
    A. More job opportunities
    B. Decrease in labor force
    C. Technological unemployment
    D. Increased unemployment
    Answer: D
12. What is the current unemployment rate in the country?
    A. 5.5%
    B. 2.2%
    C. 10%
    D. 1.5%
    Answer: B
13. What is the primary cause of disguised unemployment in rural areas?
    A. Excess labor without increased productivity
    B. Lack of rainfall
    C. Seasonal changes
    D. Slow growth of industry
    Answer: A
14. What is the result of the decay of cottage and small scale industries in India?
    A. Increased employment opportunities
    B. Decreased unemployment
    C. Rise in the potential for self-employment
    D. Problem of unemployment
    Answer: D
15. What contributes to the growth of educated unemployment in urban areas?
    A. Lack of education facilities
    B. Slow growth of industry
    C. Widespread craze for having university degrees
    D. Technological unemployment
    Answer: C
16. Why does technological unemployment occur?
    A. Lack of technology
    B. Excessive use of foreign technology
    C. Population growth
    D. Slow growth process
    Answer: B
17. What is the focus of the International Labour Organisation (ILO) and the Indian government regarding the informal sector?
    A. Discouraging it
    B. Modernization
    C. Abandoning it
    D. Ignoring it
    Answer: B
18. What is the primary source of livelihood for around 70% of India’s population in rural areas?
    A. Industrial jobs
    B. Seasonal employment
    C. Agriculture
    D. Informal jobs
    Answer: C
19. What type of unemployment is a result of a decline in demand for a product in a particular industry?
    A. Seasonal Unemployment
    B. Structural Unemployment
    C. Cyclical Unemployment
    D. Frictional Unemployment
    Answer: B
20. What characterizes technological unemployment?
    A. Temporary unemployment between jobs
    B. Excessive use of foreign technology
    C. People without updated skills in new technology
    D. Unemployment due to strikes or lockouts