What is unemployment: Definition of unemployment Every country is different, like in America, if a person does not get a job according to his qualifications, then he is considered unemployed.
In general, unemployed is said to be a person who wants to work at the prevailing wage rate in the market but cannot find work.
Employment problems are found in both developed and developing countries. Keynes, a famous economist, considered unemployment to be a bigger problem than any problem.
That is why he used to say that if a country does not have any work to get the unemployed done, then they should only get their pits filled by them and unemployed people may not do any productive work by doing this but they will not engage in unproductive work and There will be demand for goods and services in the country, due to which industrial development will continue in the country.
What is unemployed
‘Unemployed is said to be a person who wants to work at the prevailing wage rate in the market but cannot find work.’
What is voluntary unemployment and involuntary unemployment
Voluntary unemployment refers to a situation when individuals who are able to work but are not ready to work, however suitable work is available to them.
In other words, they are voluntarily unemployed, that is, unemployed of their own free will.
2. Open or Involuntary Unemployment: A person who is willing to work at the prevailing wage rate in the market but still does not get work, he will be called involuntary unemployed.
And such unemployment is called involuntary unemployment.
An involuntary unemployment means a situation in which all able-bodied individuals who are willing to work at prevailing wage rates do not get work.
Such people are physically and mentally fit to work, are willing to work at the rate of wages given but are out of job.
Thus, their unemployment is involuntary (that is, not voluntary) because they are unemployed against their wishes.
This type of unemployment is due to lack of sufficient demand to ensure full employment. This indicates an oversupply of labor which the stricter wage rate has failed to eliminate.
In short, if involuntary unemployment exists, the economy cannot be said to be at the level of absolute employment balance.
This would indicate a balance of low employment in the economy.
Difference between voluntary unemployment and involuntary unemployment
| Voluntary unemployment | Involuntary unemployment |
|---|---|
| 1. In voluntary unemployment, a person is not willing to work at the prevailing wage rate in the market. | 1. In involuntary unemployment, a person is willing to work at the prevailing wage rate in the market. |
| 2. In voluntary unemployment, a person demands a higher wage rate. | 2. In involuntary unemployment the person does not demand a higher wage rate. |
| 3. In voluntary unemployment, a person is unemployed according to his wishes. | 3. In involuntary unemployment, a person is unemployed against his wishes. |
| 4. In voluntary unemployment, suitable work is available for the individual. | 4. In involuntary unemployment, suitable work is not available for the person. |
Importance of difference between voluntary unemployment and involuntary unemployment
The significance of the distinction is that the magnitude of unemployment in an economy is reflected by the magnitude of involuntary unemployment because the former includes only involuntary unemployment.
According to Keynes, involuntary unemployment arises due to insufficiency of effective demand which can be resolved by increasing the aggregate demand through government intervention.
Note : Voluntary unemployment and involuntary unemployment are both other types of unemployment.
These two types of unemployment are found in developed countries
1. Cyclical Unemployment: This type of unemployment arises due to cyclical fluctuations in the economy.
When there is a period of prosperity in the economy, production increases, new employment opportunities are created and when the recession comes in the economy, production is reduced and less people are needed, due to which unemployment increases.
2. Frictional Unemployment: A person who leaves one employment and moves to another employment may be unemployed in the period between the two jobs, or it may be that a person is leaving or being fired due to use of new technology.
If you are looking for employment due to employment, then unemployment during the period of leaving the old job and getting new employment is called frictionless unemployment.
How many types of unemployment occur in developing countries
1.Seasonal Unemployment: This type of unemployment is found in the agricultural sector. Those engaged in agriculture get employment during the plowing, sowing, harvesting, etc.
But as soon as the agricultural work is over, the people engaged in agriculture become unemployed.
2.Disguised Unemployment: Disguised unemployment is the unemployment in which the productivity of some people is zero, that is, even if these people are removed from that work, there will be no difference in production.
For example, if 10 people are manufacturing 100 shoes in a factory and if 3 people are removed out of it, then even if 100 shoes are made, then these 3 removed people will be disguised as unemployed. This type of unemployment is a big problem in India’s agriculture.
3.Structural Unemployment: Structural unemployment appears when long-term conditions in the market change.
For example: Scooter production in India has stopped and car production is increasing. Due to this new development, the mistry engaged in scooter production became unemployed and the demand for car makers has increased.
This type of unemployment arises due to changes in the economic structure of the country.
So you read what unemployment is? What is the type of unemployment and what type of unemployment is found in India and what is the difference between voluntary unemployment and involuntary unemployment? Apart from this, there are some unemployed people who can also get wages but still these people do not want to work like: beggars, sadhus and spoiled sons of rich father etc.
Originally posted 2020-05-05 08:41:00.
