UNEMPLOYMENT
An unemployed person is one who have potentialities and willingness to earn is unable to find a remunerative work. Sociologically it is defined as “forced or involuntary separation from remunerative work of a number of normal working force that is , 15-59 age group during normal working time at normal wages and under normal crcumstances.”
Planning commision has defined a person marginally unemployed when it remains without work for 6 months. International labor organization assumes a person employed if it gets 15 hours work in a week.
Types of unemployment:
There are many ways in which unemployment can be classified. One is Seasonal unemployment, cyclical and technological unemployment.
Seasonal unemployment is when person is unemployed in some seasons of year. It generally happen in agriculture based sectors like in sugar factories and in agriculture itself.
Cyclical unemplyment happen due to voltality in trade and business. When businessmen earns higher profits, they invest it in business which increases employment but when profit goes down or loss comes in, they start firing workers as we have seen it happen in 2009 recession.
Techonological unemployment is caused when there is decrease in number of available jobs due to automation or mechinzation. Advancement of techonolgy generally causes displacement of human labour. In fact some new inventions do more than displacing human labor. They causes damage to old investments and that exacerbates poverty and thus restrict market for new investments. Thusnwe see a vicious circle created.
Educational unemployment is created when the system of education can not produce employable persons. One of UGC reports stated that present system of education is generating much waste and stagnation. A large number of graduates remain unemployed because industry does not find them suitable for existing jobs. Education seems to be of little relevance to the needs of nation.
Some concepts related to labor force
All perons who are working and though not working, are seeking and available for work, are deemed to be in lobor force. Hence all those who are not working and neither seek8ng nor available for work are jot considered part of labor force and does not figure in unemployment data.
Labor force participation rate (LFPR)is ratio of number of persons in labor force by total population.
Work participation ratio is ratio of number of persons in workforce and total population.
Unemployment rate is ratio of number of people unemplyed and number of persons in labor force.
Usual principal status of labor force
It is status of individual during a reference period of one year. According to this concept if a person is either working or looking to work during longer part of a year ie more than half of year will be part of labor force. Therefore usual status measure reflect only lang unemployment spells. For example a male would be unemplyed on usual status only when unemployed spell during reference year is longer than emploed period.
Usual principal and subsidiary status
This concept was introduced to widen the UPS concept to include even those who r outside labor force on basis of majority time criteria but had been employed for some part of year( nsso 61st round assumed this period 30 days) on the usual basis. Therefor it is a hybrid concept incorporating both major time criteria and priority to work status.
Current weekly status
Under this concept if a person is employed or seeking to work or available for work at least one hour during a reference period of one week, then it will be part ot labor force.
Current daily status
This concept was recommended by dantewala committee. This concept is used too determine intensity of work. A reference week is divided in 14 half days. If a person is employed for. If a person is employed or seeking to be employed for 1 hr or more upto 4 hrs in half day will be part of labor force. Employment status is recorded during 7 daye of week in terms of half or full intensities.
Largely CDS is used as basis of estimation of unemployment and uemployment in country. It is the most inclusive rate of unemployment giving average level of unemployment on a day during the survey year.
Attempt to deal with unemployment hitherto have ben two pronged:
1. To alleviate status of the unemployer eg giving it vocational education or providing loan for income generating asset.
2. To abolish unemployment itself by increasing number of jobs.
Lord keynes said that in advanced economies unemployment was due to deficiency in effectivemdemand. Thus kenesian remedies for unemployment concentrated on measures to keep level of demand sufficiently high so that economic machine does not slacken the production of goods and services. It was applied after great depression of 1930s and second world war to alleviate messy economic situations.
