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Project On Unemployment in India: Indian Institute of Planning and Management
Project On Unemployment in India: Indian Institute of Planning and Management
Management
PROJECT ON
UNEMPLOYMENT IN INDIA
Submitted by:
1
INDEX
Page
Sr. No. TOPICS No.
2. Concept of unemployment. 4
9. Solution. 19
10. Conclusion. 20
11. Weblography. 21
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Unemployment in India
DEFINATION:
Unemployment is the state in which a person is without work, available to
work, and is currently seeking work.
INTRODUCTION:
It involves a waste of human resource and results in many social evils like theft, pick-
pocketing, robbery, murder etc. It’s a serious economic, social and political problem
of the country. It’s a
cause as well as effect
of poverty. The
unemployment rate is
used in economic
studies. Rate is
determined as the
percentage of those in
the labor force without
jobs.
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CONCEPTS OF UNEMPLOYMENT
2) Current Weekly Status: This concept determines activity status of a person with
reference to a period of preceding seven days. In this period, if a person seeking job
fails to get work for even one hour on any day, he is deemed to be unemployed.
3) Current Daily Status: This concept considers the activity status of a person for
each person for each day of the preceding seven days .If he works for one day but less
than four hours, then he is considered as employed for half a day.
UNEMPLOYMENT IN INDIA:
3. The incidence of unemployment among the educated is much higher than the
overall unemployment.
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TYPES OF UNEMPLOYMENT
Economists and social thinkers have classified unemployment into various types.
Generally unemployment can be classified in two types:
VOLUNTARY UNEMPLOYMENT:
In this type of unemployment a person is out of job of his own desire doesn't work on
the prevalent or prescribed wages. Either he wants higher wages or doesn't want to
work at all. It is in fact social problem leading to social disorganization. Social
problems and forces such as a revolution, a social upheaval, a class struggle, a
financial or economic crisis a war between nations, mental illness, political corruption
mounting unemployment and crime etc. threaten the smooth working of society.
Social values are often regarded as the sustaining forces of society. They contribute to
the strength and stability of social order. But due to rapid social change new values
come up and some of the old values decline. At the same time, people are not is a
position to reject the old completely and accept the new altogether. Here, conflict
between the old and the new is the inevitable result which leads to the social
disorganization in imposed situation. In economic terminology this situation is
voluntary unemployment.
INVOLUNTARY UNEMPLOYMENT:
In this type of situation the person who is unemployed has no say in the matter. It
means that a person is separated from remunerative work and devoid of wages
although he is capable of earning his wages and is also anxious to earn them. Forms
and types of unemployment according to Hock are.
a. Cyclical unemployment - This is the result of the trade cycle which is a part
of the capitalist system. In such a system, there is greater unemployment and
when there is depression a large number of people are rendered unemployed.
Since such an economic crisis is the result of trade cycle, the unemployment is
a part of it.
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responsible for it there may be dispute amongst the partners, the business may
give huge loss or the business may not turn out to be useful and so on.
6
RURAL UNEMPLOYMENT:
This kind of employment prevails is on rural areas. The nature of problem is also
complicated. There are only two types of unemployment commonly found in
agricultural economy e.g. India
a) Seasonal Unemployment:
In an agrarian economy like India, seasonal unemployment is the most significant
type of unemployment in rural sector. Agriculture labour in India is mostly dependent
on monsoon.
b) Disguised Unemployment:
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In the rural subsistence agrarian sector of the Indian economy, the problem of
disguised unemployment is also typical. Disguised unemployment refers to that type
of unemployment in which laborers appear to be working and employed but in
reality, they are not employed as they do not add to the total output. In other words
they are removed from their jobs, output would not decrease.
URBAN UNEMPLOYMENT:
This type of unemployment is found in urban areas i.e. towns and cities.
1) Industrial Unemployment:
2) Educated Unemployment:
CAUSES OF UNEMPLOYMENT
Unemployment levels are increasing dramatically in many parts of the world. There is
considerable debate among economists as to the causes of unemployment. Keynesian
economics emphasizes unemployment resulting from insufficient effective demand
for goods and service in the economy. Others point to structural problems,
inefficiencies, inherent in labour markets. Classical economics tends to reject these
explanations, and focuses more on rigidities imposed on the labor market from the
outside, such as minimum wage laws, taxes, and other regulations that may
discourage the hiring of workers.
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In the set up of a modern market economy, there are many factors, which contribute
to unemployment.
Causes of unemployment are varied and it may be due to the following factors:
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RECESSION:
INFLATION:
10
DISABILITY:
EFFECTS OF UNEMPLOYMENT
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Unemployment has obvious and well-documented links to economic disadvantage
and has also been connected in some discussion to higher crime rates especially
among the young suicide,
and homicide Garry Ottosen
and Douglas Thompson
(1996) broaden the
consequences of
unemployment, relating it to
increases in the incidences of
alcoholism, child abuse,
family breakdown,
psychiatric hospitalization,
and a variety of physical
complaints and illnesses.
Some researchers have
emphasized the importance of preventing youth from falling into unemployment
traps. Robert Gitter and Markus Scheuer (1997) suggest that unemployment among
youth not only causes current hardship, but may also hinder future economic
success. This is because unemployed youths are not able to gain experience and on-
the-job training and because a history of joblessness signals that the individual may
not have the qualities that are valued in the labour market.
Attempts have, however, been made to estimate the economic cost associated
with unemployment. Ottosen and Thompson (1996, p.5) noted that "the United
States loses a little less than one percentage point of potential gross domestic
product (GDP) or output for each one percentage point of unemployment. This
implies that an unemployment rate of 7 percent costs the United States at least $400
billion annually in foregone output. This is more than $2,000 for every man,
woman, and child over 16 years of age." Similarly, in Australia, Peter Kenyon
(1998) calculated that the loss of GDP associated with an unemployment rate above
the full-employment rate is the equivalent of one year's worth of GDP over the past
two decades.
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NATURAL RATE:
The natural rate of unemployment is the rate of unemployment where the labour
market is in a position of equilibrium. This means that the labour supply = labour
demand at a given real wage rate. All those people willing and able to take paid
employment at the going wage rate do so.
The diagram below shows the labour supply (those willing and able to take work
at a going wage rate) and the labour force - the number of active participants in the
labour market. The labour force expands as the real wage rises because there is a
greater incentive to search for paid work and sacrifice leisure.
Employment on the x-axis measures the total labour hours supplied by workers
in the economy in a given time period. As the real wage increases, the total number
of hours supplied by the labour force will expand.
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"market-clearing wage") employment contracts along the labour demand curve and
total unemployment rises (see the diagram below)
Dis-equilibrium unemployment rises to the level shown by the distance CD. This
is because labour demand has fallen and the labour force has expanded. There is an
excess supply of labour - some people who are willing and able to find employment
cannot get paid work.
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LABOUR FORCE STATISTICS FROM
THE CURRENT POPULATION SURVEY
Series Id: LNS14000000
Seasonally Adjusted
Series title: (Seas) Unemployment Rate
Labor force status: Unemployment rate
Type of data: Percent or rate
Age: 16 years and over
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REMEDIES FOR SOLVING PROBLEMS
OF UNEMPLOYMENT
Reducing unemployment is a key target for all Governments. High unemployment
has enormous costs for individuals, businesses, the Government and the economy.The
way of solving unemployment will depend upon its cause
METHODS:-
Provide more training and education to the unemployed. This could help
improve computer skills and communication. These people will become more
confident and employable.
Try to bring the country out of a recession. The Government needs to try to
create demand in the economy. It could;
NEW DEAL: Labour’s New Deal programme for young unemployed people was
introduced across the UK in April 1998. In June 1998 the Government launched a
separate New Deal for Long-Term Unemployed People aged over 25+.
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Work within the accredited voluntary sector and
The programme is designed to provide pathways back into work for the long term
unemployed – many of whom have become outsiders in the labour market despite the
continuing strength of the British economy. Higher levels of employment and
economic activity add to total national output and should help to improve the overall
performance of the labour market in sustaining long run economic growth.
Such as:-
Employment Strategies during the 1990s: Defining its employment perspective the
Eighth Plan clearly stated, “The employment potential of growth can be raised by
readjusting the sectoral composition of output in favour of sector and sub-sector
having higher employment elasticity.” In certain sectors where technologies are to be
upgraded to a higher level of efficiency and international competitiveness, there is
little scope for generating additional employment. However, in respect of certain
other sectors some flexibility may be available in the choice of technologies and thus
it may not be difficult to generate considerable employment.
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According to the present estimates, the employment strategy as stated above
will enable attainment of the goal of full employment in any case not before 2012
A.D. Therefore, special employment programmes as in the past should be continued
to provide short-term employment to unemployed and underemployment among the
Poor and the Vulnerable.
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1. MAJOR EMPLOYMENT PROGRAMS
· Swaranjayanti Gram Swarozgar Yojana (SGSY) was launched from April 1, 1999 after
restructuring the IRDP and allied schemes. It is the only self-employment programme for the
rural poor.
· Sampoorna Grameen Rozgar Yojana (SGRY) was launched on September 23, 2001 and
the scheme of JGSY and Employment Assurance Scheme was fully integrated with SGRY. It
aims at providing additional wage employment in rural areas.
· The Swarana Jayanti Shahari Rozgar Yojana (SJSRY) came into operation from
December 1, 1997, subsuming the earlier urban poverty alleviation programmes. It aims to
provide gainful employment to the urban unemployed and underemployed poor by
encouraging the setting up of self-employment ventures or provision of wage employment.
· The National Rural Employed Programme (NREP) was started as a part of the Sixth plan
and was continued under the Seventh Plan. It was meant to help that segment of rural
population which largely depends on wage employment and has virtually no source of
income during the lean agricultural period.
· The Rural Landless Employment Guarantee Programme (RLEGP) was started on 15th
August, 1983, with the objective of expanding employment opportunities for the rural
landless, i.e., to provide guarantee to at least one member of the landless household for about
100 days in a year.
· The Integrated Rural Development Programme (IRDP) was launched in 1978-79 and
extended all over the country in 1980-81.It was to provide self-employment in a variety of
activities like sericulture, animal husbandry etc. in primary sector, handicrafts etc. in
secondary sector , and service and business activities in the tertiary sector.
· The Scheme of Training Rural Youth for Self-Employment (TRYSEM) was initiated in
1979. It aimed at training about 2 lakh rural youth every year to enable them to become self-
employed.
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Jawahar Rozgar Yojana (JRY) was announced in February 1989, it was supposed to
provide intensive employment creation in the 120 backward districts. It was later renamed
Jawahar Gram Samridhi Yojana (JGSY) whose objective was creation of infrastructure
and durable assets at the village level so as to increase opportunities for sustained
employment to the rural poor.
· The Employment Assurance Scheme (EAS) aimed at providing 100 days of unskilled
manual work on demand to two members of a rural family in the age group 18 to 60 years in
the agricultural lean season within the blocks covered under the scheme.
Till now these programmes have not been launched on a sufficiently large scale and thus
their contribution from the point of view of the reduction in the incidence of unemployment
seems to be only marginally.
The three major problems which prevent pursuit of these programmes on a considerable
scale are the choice of appropriate works are to be done; finding the resources to finance the
programmes; and the lack of clarity with regard to the organisation of the rural work programmes
meant to generate employment.
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SOLUTION
Unemployment agencies could tighten their job search and job acceptance requirements.
Improvements to the education and training provided to young people, with a greater
focus on vocational skills.
Countries need to ensure that their welfare systems do not provide discouragement to
work.
Provide more training and education to the unemployed. This could help improve
computer skills and communication. These people will become more confident and
employable.
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CONCLUSION
The whole length of discussion concludes that to solve the unemployment problem of India the
development plans and the family planning programmed, both, should be reformed on the lines
suggested herein above whereby the extra employment opportunities will be generated fast, on
one hand, and population growth will be checked, on the other, in such a way that growth of
employment opportunities would considerably exceed to the population growth.
To solve these massive problem efforts should be made to rectify the mistakes in the
development move on one hand, & to mitigate the high population growth, on the other reselect
its programmers & reconstruct its plans so as to make the development move rural oriented.
This will bring about fast agricultural development, uplift of village life & revival of village
industries, artisanship & handicraft to check the massive rural- urban migration. As regards to the
check on high population growth the prevailing family planning programmed has been proved
insufficient & incomplete. .
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WEBLOGRAPHY
1. www.economywatch.com
2. www.scribedoc.com
3. www.isid.ac.in
4. ideas.repec.org
5. www.legco.gov.hk/
6. www.jstor.org/stable/1818137
7. www.informaworld.com
8. www.cdedse.org/pdf/work174.pdf
9. www.icai.org/resource_file/16789ppui.pdf
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