for India! Unemployment is certainly defined as people of working age, available for work and are actively seeking for employment 1.India being a developed country is suffering massively due to rising unemployment in the country. In 2008, The country suffered from a massive long term recession in which millions of Indians either lost their jobs and were unable to find a suitable job. According to the article, unemployment rate current is 3.8%, which is still a very high rate. Due to Hidden unemployment which is termed as people without job for a long period of time ,people with part time work and do not want to switch over full time work . and those who are over qualified for the job they are working in the present. This type of unemployment leads to damaging of emotions and mental state of any unemployed person which is a cause of serious health issues such as depression. The article mentions that due to geographical disparities and migration, the unemployment is increasing in India. Geographical disparities such as the inner city of India, the villages do not have access to full time work or the inhabitants are employed into the primary sector of the business, the agricultural sector. Migration is very normal in India as most industries either pay their employees very less salary or are paying less than the national minimum wage (This situation is very common with the low paid sectors of employement such as Wastepickers or road constructors which are paid on a daily basis in India. What are the cost incurred by the unemployed people of being Unemployed? 1. They are cost to themselves as they become dejected due to non availability of job and eventually which leads to anxiety and depression. Also, high levels of suicide were recorded in India due to unemployment because the person who is employed thinks that he/she is a burden to the family or is not 1 Definition from Oxford Economics Course Companion by Ian Dorton
successful .Emotionally , Unemployment just deepens or worsens the
situation of life of any unemployed person . 2. They are responsible to the society in the form of poverty and crime rates being high: Crime rates and unemployement are directly related as unemployemeny often leads to serious crime activities such as theft to earn more money 3. They are also responsible to the economy as unemployement reduces the actual output produced by the economy, Gross domestic product of a country worsens down. What is the cause of unemployment in India? The article mentions that due to gap between demand and the supply of skills required in Job, the country is suffering from unemployement as employement is getting shifted due to migration.This is often reffered to as structural employement where there is a mismatch between the skills and number of jobs available. A diagram is shown below to depict this:D
S1 S
W W1 S1 S
Q1
This diagram shows that due
to shortage of labour, the wage rate of the country decreases and also decreasing the quantity of labour
Are there any solutions to this deep rooted problem of unemployment in
India? Unemployement is certainly not easy toreduce but to some extent it can be overcomed .The Government of India has introduced the scheme of Unemployement allowance in India wherein the unemployed registers with the government the skills he/she currently has and the government has to provide a job within a year .If the government is unable to find a job, the allowance is given to the unemployed person till the time there is no job provided by the government. But will this still reduce the unemployement rate? No, certainly not as this is not an effective method. There are two types of solutions to the structural unemployement:1. Interventionist policies which requires intervention of the government which include an education system that trains the unemployed people to be occupationally fit and flexible to work.It also includes any apprenticeship programmes provided by the government to provide necessary skills required 2. Market Based supply side policies: This includes reducing unemployement benefits to the unemployed so that they get motivated to work and an incentive to work for. Also this includes deregulation of labour markets by removing legal barriers in job hiring and unemployement practices Reducing Unemployment has always been a macroeconomic aim of the government but is not able to fulfil to the maximum as some or the other region suffers from unemployment.