Ex

  Economics (NTSE/Olympiad)  

2. Sectors of the Indian Economy

Disguised Unemployment

Disguised Unemployment
It is a situation in which more workers are working in an activity than required.
Disguised Unemployment :
Situations where people are apparently working but all of them are made to work less than their potential. This kind of underemployment is hidden in contrast to someone who does not have a job and is clearly visible as unemployed. Hence, it is also called disguised unemployment. This underemployment can also happen in other sectors There are thousands of casual workers in the service sector in urban areas who search for daily employment. They are employed as painters, plumbers, repair persons and others doing odd jobs. Many of them don't find work everyday. They are engaged in work where they may spend the whole day but earn very little. They are doing this work because they do not have better opportunities.
Difference between open unemployment and disguised unemployment :
Open unemployment is different from disguised unemployment. under open unemployment someone does not have a job and is clearly visible as unemployed. While under disguised unemployment situation we find hidden situation of unemployment. It is not clearly visible
To understand differences between both types of unemployment-Open employment and disguised employment, we take the following example.
For instance we can take the case of small farmer of a village. He owns nearly two hectares of unirrigated land. All seven members of his family work in the plot throughout the year. Why ? They have nowhere else to go for work. You will see that everyone is working, none remains idle, but in actual fact their labour effort gets divides. Each one is doing some work but no one is fully employed. This is the situation of underemployment, where people are apparently working but all of them are made to work less than their potential. This kind of underemployment is hidden in contrast to some one who does not have a job and is clearly visible as unemployed. Hence, it is also called disguised unemployment.

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