Unemployment: Some basic facts
In the context of India, the total labour force is about 467 million, and the unemployment rate is 9.5 %, which is not very high as compared to many other developing countries.
UNEMPLOYMENT IS a situation which exists when members of the labour force wish to work but cannot get a job. It is, therefore, used in the sense of involuntary unemployment, rather than the voluntary decision on the part of someone to choose leisure rather than work, and, probably, a higher income. In other words, unemployment refers to inability to obtain a job when one is willing and able to work.
Unemployment has been divided into various categories, corresponding to different causes. These causes do not operate independently, but they interact. Let us look at these categories:Demand-deficiency, or Keynesian, unemployment which occurs when there is not enough demand for goods and services to provide jobs for all the available workers. This type of unemployment could be reduced by extra private or government spending and stimulus packages, as had happened during the last two years that had witnessed the world-wide recession.
Classical unemployment occurs when real wages are too high relative to productivity for it to be profitable to employ all the labour force. This kind of unemployment can be reduced by real wage-cuts, or by improvements in productivity, through better training, or reform of restrictive practices.
Structural unemployment occurs through a mismatch between the skills and location of unemployed workers and unfilled vacancies. This can be reduced by measures to retrain or relocate unemployed workers, or to relocate firms and redefine jobs so as to use the skills of the unemployed.
Frictional unemployment occurs when matchable unemployed workers and vacancies both exist, but the process of connecting them is slow or inadequate. In other words, there is no link between the producers of manpower and their users. This kind of unemployment can be reduced by making the matching process more efficient, or improving labour exchanges.
Search unemployment occurs where workers are unemployed while looking for a suitable job.
There is some unemployment which is due to the impaired employability of potential workers. Reduction of this requires an assortment of measures. Some potential workers could be made available for employment if there were better facilities for child-care, and assistance in caring for sick, handicapped, or elderly relatives. There is also a distinction between voluntary and involuntary unemployment. But some economists think that this distinction is too subjective to be useful. For example, some of the unemployed simply do not want work, at least of any form for which they are qualified. This can be due to a variety of causes. Some are simply idle, or have gainful occupation in the unofficial economy. This form of unemployment might be reduced by workfare where income support is made conditional on some form of work. Others are simply taking holidays between spells of hard and boring work; others again are engaged in educating themselves, or practicing the various arts. Unemployment is, therefore, due to too many and complex causes for there to be any one simple cure for it. Some other categories of unemployment are: classical unemployment, cyclical unemployment, demographic unemployment, disguised unemployment, frictional unemployment, involuntary unemployment, Keynesian unemployment, long-term unemployment, natural rate of unemployment, non-accelerating inflation rate of unemployment, search unemployment, seasonal unemployment, structural unemployment, technological unemployment, transitional unemployment, and voluntary unemployment. Such categories of unemployment exist almost in all the countries, but for a short period. In the context of India, the total labour force is about 467 million, and the unemployment rate is 9.5 %, which is not very high as compared to many other developing countries. The total employment is thus 90.5 %, out of which about 93% are employed in the various segments of the unorganized (informal) sector, and the remaining 7% in the private (corporate) sector and public sector. India has tremendous manpower, and it is because of this unusual strength, India will soon become a super power.
Classical unemployment occurs when real wages are too high relative to productivity for it to be profitable to employ all the labour force. This kind of unemployment can be reduced by real wage-cuts, or by improvements in productivity, through better training, or reform of restrictive practices.
Structural unemployment occurs through a mismatch between the skills and location of unemployed workers and unfilled vacancies. This can be reduced by measures to retrain or relocate unemployed workers, or to relocate firms and redefine jobs so as to use the skills of the unemployed.
Frictional unemployment occurs when matchable unemployed workers and vacancies both exist, but the process of connecting them is slow or inadequate. In other words, there is no link between the producers of manpower and their users. This kind of unemployment can be reduced by making the matching process more efficient, or improving labour exchanges.
Search unemployment occurs where workers are unemployed while looking for a suitable job.
There is some unemployment which is due to the impaired employability of potential workers. Reduction of this requires an assortment of measures. Some potential workers could be made available for employment if there were better facilities for child-care, and assistance in caring for sick, handicapped, or elderly relatives. There is also a distinction between voluntary and involuntary unemployment. But some economists think that this distinction is too subjective to be useful. For example, some of the unemployed simply do not want work, at least of any form for which they are qualified. This can be due to a variety of causes. Some are simply idle, or have gainful occupation in the unofficial economy. This form of unemployment might be reduced by workfare where income support is made conditional on some form of work. Others are simply taking holidays between spells of hard and boring work; others again are engaged in educating themselves, or practicing the various arts. Unemployment is, therefore, due to too many and complex causes for there to be any one simple cure for it. Some other categories of unemployment are: classical unemployment, cyclical unemployment, demographic unemployment, disguised unemployment, frictional unemployment, involuntary unemployment, Keynesian unemployment, long-term unemployment, natural rate of unemployment, non-accelerating inflation rate of unemployment, search unemployment, seasonal unemployment, structural unemployment, technological unemployment, transitional unemployment, and voluntary unemployment. Such categories of unemployment exist almost in all the countries, but for a short period. In the context of India, the total labour force is about 467 million, and the unemployment rate is 9.5 %, which is not very high as compared to many other developing countries. The total employment is thus 90.5 %, out of which about 93% are employed in the various segments of the unorganized (informal) sector, and the remaining 7% in the private (corporate) sector and public sector. India has tremendous manpower, and it is because of this unusual strength, India will soon become a super power.
 | Previous Post |
| Next Post |  |
Login
 Login through Social ID
|
Not finding what you are looking for? Search here.
