Unemployment-Biggest Challenge to Indian Economy

Indian has been a world leader in producing employment opportunities.But with the hard hit of technology,productive employment opportunity in India is still a dream.
Unemployment-Biggest Challenge to Indian Economy
Courtesy-Pa Unemployment

What is employment?
It refers to an situation when able bodied person are willing to work at existing wage rate and get job in the country.

What is unemployment?
It refers to an situation when able bodied person are willing to work at existing wage rate and but does not get job in the country.

Able bodied person most be involved in a economic activity otherwise at will make no change.According to Economics, activities which contributes to GNP through the production of goods and services are known as economic activities.

Difference between Labour force and Work force
You might wonder that both this terms are almost same.But that's not so according to Economics.The total number of people actually working and people who are willing to work are known as labour force.It is also known as potential labour force of the country.Whereas,the total number of people actually working and does not include people who are willing to work is known as the work force of the country.It is also known as actual labour force of the country.

Who is a worker?
Worker is the one who is engaged in an economic activity and contributes towards the economic development of the country.
GDP gross domestic product
Courtesy-News First

GDP-Gross Domestic Product

It is the sum total of the money value of all the goods and services produced within a country in an accounting year.It is calculated only on the final goods and not on the intermediate goods.

GNP-Gross national Product
It is obtained by adding the net earning from the foreign transactions to the GDP in an year.

GNP=GDP + Net factor income from abroad(NFIA)
NFIA=Factor income received from abroad(FIRA)+Factor income paid to abroad(FIPA)

Why do people work?
Every work is done to achieve a fixed objective.Just like that,there must be some motives to perform work.Firstly,one engage tin an economic activity to earn a living.Secondly,for self-satisfaction.Thirdly,to contribute towards the economic development of the country.Fourthly,working gives a sense of accomplishment because he/she is able to satisfy the need of dependents.

Worker population ratio(WPR)
It refers to number of people employed per hundred people.It is also known as workforce participation ratio.It can be also be defined as the ratio between total number of working population to that of total population per hundred. Increase in worker population ratio shows the economic development of the country whereas decrease shows decline in economic development of the country.
As per the 2009-10 reports, India's worker population ratio is 38.6% which consists 39.9% rural population (men-54.4% and women-21.9%) and 35.5% urban population (men-54.6% and women-14.7%).
There are various features of worker population ratio was are very helpful in determining the development of the country-
1.Worker population ratio(WPR) of developing countries is low as compared to developed countries. The reason behind this may be that developing countries lack infrastructure which is necessary to provide employment opportunities to people.
2.Worker population ratio(WPR) of rural areas is more than urban areas because people in rural areas does not have any option instead of working on low wages.
3.Worker population ratio(WPR) of Men is more than women because of backward thinking of people and definition of economic activities and discrimination.
4.Worker population ratio(WPR) of female in rural areas is more than female in urban areas.

Types of employed workers
On the basis of employment status, the workers can be categorized into three
1.Self employed workers
They operate their own farm or non-farm enterprise which means they independently are in profession on trade.50% of country's labour population are self employed workers. Example-businessman, farmers.
2.Regular salaried employees
The persons who works in other farm or non-farm enterprise and in return get regular wages.15% of country's labour population are regular salaried employees. Example-government employees
3.Casual wage labourers
The persons who are casually engaged in other farm or non-farm enterprise and in return get wages daily or periodic contracts.33% of country's labour population are casual wage labourers.

Distribution of workforce by economic activities
All the major economic activities can be categorized into three i.e primary,secondary and tertiary and 8 industrial divisions.They are
1.Agriculture and allied activities
2.Mining and quarrying
3.Manufacturing
4.Electricity, gas and water supply
5.Services
6.Trade
Major economic activities
Courtesy-Rental House Business
7.Transport and storage
8.Construction

Primary sector
(A)Agriculture and allied activities
(B)Mining and quarrying

Secondary sector
(A)Construction
(B)Manufacturing
(C)Water,gas and power supply

Tertiary sector
(A)Services
(B)Trade
(C)Transport and storage     

Jobless growth
It refers to acceleration of the growth rate of the GDP which is not accompanied by expansion of employment opportunities.This type of growth will occur if capital intensive techniques will be used instead of labour intensive techniques.Jobless growth was more during the time of 1991 when policies like liberalization,privatization and globalization came into existence.

Casualation of Workforce
It is process of moving the self-employed workers and regular-salaried workers to casual wage jobs.

Reasons for Casualation
1.Due to low scope in agriculture sector,self-employed farmers move to casual wage jobs.
2.Displacement of  employees of large companies change their status from regular-salaried workers to casual wage workers.
3.Slow development in organised sector also cause a move from regular-salaried workers to casual wage workers.
4.High demand for casual wage workers in construction,trade etc.

Types of unemployment 
There are 6 types of unemployment,namely-
1.Disguised unemployment
If more number of workers are employed then required number of workers.Hence the productivity of the workers will be wasted.
2.Seasonal unemployment
Agriculture is an seasonal occupation,means crops are grown only in a specific season and the rest of the time,farmers are unemployed.
3.Open unemployment
Open unemployment refers to an situation when able bodied person are willing to work at existing wage rate and but does not get job in the country.
4.Under employment
This type of unemployment occurs when workers are not able to utilize their full time labour and the income earned is inadequate to sustain himself/herself.
5.Frictional unemployment
Frictional unemployment occurs due to imperfection i.e failure of machinery or lack of raw material and mobility of workers across different occupation
6.Cyclic unemployment 
Cyclic unemployment occurs due to raise and fall of trade practices and change in demand conditions.   

Unemployment-Biggest Challenge to Indian Economy Unemployment-Biggest Challenge to Indian Economy Reviewed by Saurabh Jadhav on October 24, 2017 Rating: 5
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