Unemployment and its type

Unemployment

It is a situation in which people are ready and willing to work at the existing rate of wages but still, they cannot get work.

Measurement unemployment and employment are done by NSSO (National Sample Survey Organization) in India.

NSSO divide people into the following three categories -
(a) Working people (engaged in an economic activity)
(b) Not working (looking for work)
(c) Neither working nor looking for workPeople in category (a) are called 
People in category (a) are called workforce.
People in category (b) are called unemployed.People in categories (a) and (b) are called Labour force.
People in category (c) are called not in the Labour force.
Number of unemployed = Labour force – Workforce

Unemployment data in India are kept under the Ministry of Labour and Employment.

Types of Unemployment-

Structural Unemployment-

Caused by structural change.

Example- technological change, growing population etc.

Frictional Unemployment-

When people shift from one job to another and remain unemployed during this interval period.

Cyclical Unemployment (Demand Deficiency Unemployment)-

When people are thrown out from the job due to a decrease in demand.

Example- recession

Disguised Unemployment-

In this type of employment, people are employed but their marginal productivity is zero.

Example- One man is engaged in some agriculture work, his friend joins him but the productivity of both remains same. His friends come under disguised unemployment.

Educated Unemployment-

If one educated person not able to get a suitable job suited to his qualification.

Example- Engineering graduate is getting clerk post instead of engineer post.

Open Unemployment-

A condition in which people do not find any work to do.

It includes both skilled and non-skilled people.

Under Unemployment-

When people obtain work but their efficiency and capability are not utilized at their optimum and they contribute in the production up-to a limited level.

Voluntary Unemployment-

In this type of unemployment, jobs are available but individual wants to remain idle.

Example- lazy people, people who have ancestor property do not want to earn.

Natural Unemployment-

2 to 3 % unemployment considered natural and cannot be eliminated.

Chronic Unemployment-

Caused due to the long-term unemployment present in the economy.

Seasonal Unemployment-

In this type of unemployment, people are unemployed for few months of the year.

Example- Farmers