Unemployment refers to a situation in which the workers who are capable of working and willing to work do not get employment. Unemployment also refers to a situation where the persons who are able to work and willing to work, fail to secure work or activity which gives them income or means of livelihood.


In Rural employment, both unemployment and underemployment exist side by side. The increasing population implies an increasing pressure on land. This pressure on land has resulted in an increase in number of agriculturists, and this has largely contributed to the problem of ununtilized labour in the agriculture sector.

1. SEASONAL UNEMPLOYMENT- caused by seasonal varieties in production or demand or both. When the works are engaged in a particular work or occupation, get employment only for a limited period and remain idle for the remaining period.

2. DISGUISED UNEMPLOYMENT- In Indian villages, people are found to be apparently engaged in agricultural activities. In such a situation, even if many works are withdrawn, same work will continue to be done by fewer people. It follows that all the workers are not needed to maintain the existing level of production. The contribution of such labourers to production is zero or near zero.


Urban employment is largely the off-shoot of rural employment. With the growing process of making of peasantry very poor in the wake of introduction of the capitalist system of farming, and in the face of increasing pressure of population on land, a mass departure of population from rural areas to urban areas take place.

1. STRUCTURAL UNEMPLOYMENT- caused by structural changes like rapidly growing population, fall in the rate of capital formation, technological change etc., in the economy. It is of long run nature.

2. DISGUISED UNEMPLOYMENT- A person is apparently employed bit their marginal product is zero. Marginal product means the product and the produce added to the existing production due to the addition of new employee/ worker.

3. EDUCATED UNEMPLOYMENT- Even a person who is educated/trained and skilled fails to obtain a suitable job suited to his qualification he is said to be educated unemployed.

4. OPEN UNEMPLOYMENT- The labourers when live without any work and they dont find any work to do they come under the category of unemployment. Educated unemployment and skilled labourers unemployment are included in open unemployment. The migration from rural to urban areas in search of work is very often found in India is an example of open unemployment.

5. UNDER UNEMPLOYMENT- refers to the underutilization of manpower available both in terms of time and skill. If a master of engineering graduate work as a clear or an office assistant in an office, he is underutilized in terms of man power.

6. VOLUNTARY UNEMPLOYMENT- Though jobs are available some person may want to remain idle come under the category of this kind. The people who do not have the mind set to work regardless of their economic position and lazy people are included in this category.

7. NATURAL UNEMPLOYMENT- Unemployment ranging between 2 to 3% in the country is considered natural and inevitable. This minimal percentage of unemployment cannot be eliminated at all.


The unemployment problem in India has assumed alarming dimensions since independence.

1. POPULATION GROWTH- The galloping in population of our country during the last decades has increased the unemployment problem in the country.

2. INSUFFICIENT RATE OF ECONOMIC PROGRESS- The rate of growth is inadequate to absorb the entire labour force in the country. The opportunity of employment are not sufficient to absorb which are taking place as result of the rapidly increasing population in India.

3. ABSENCE OF EMPLOYMENT OTHER THAN AGRICULTURE- Agriculture is the principle area of employment in the country A major cause of rural unemployment refers the extremely low rate of growth of agriculture.

4. JOINT FAMILY SYSTEM- Existence of joint family system in India promotes disguised unemployment. Usually the members of a family work on their family farms or do family business.

5. SLOW DEVELOPMENT OF INDUSTRIES- Industrialization is not rapid in our country and industrial labours finds few job opportunities. The surplus labour in the agriculture sector labour is not absorbed by the industrial sector.

6. INAPPROPRIATE TECHNOLOGY- An important cause in the urban industrial sector is the use of inappropriate technology. Instead of using technology suited to our requirement of utilizing abundant labour supply available in the country, western modern highly capital-intensive technology is adopted which minimizes use of labour.

The need of hour to fight poverty and unemployment is to have belief approach towards education system and employment generation programmes in rural areas through recent initiatives such as skill India which is a campaign launched by Prime Minister Damodardas Modion 15 July 2015 which aim to train over 40 crore people in India in different skills by 2022.

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