The document discusses employment, unemployment, and policies related to employment in India. It notes that employment generation declined in the mid-1990s but increased in the late 1990s and 2000s. The majority of employment is in the primary sector, with decreasing shares in agriculture and increasing shares in secondary and tertiary sectors over time. Unemployment, both rural and urban, has increased over the decades. Causes of unemployment include slow economic growth, population growth, and inadequate employment planning. Measures to address unemployment and underemployment focus on high economic growth, increasing investment, rural development, rural industrialization, and education and skill development.

1. EMPLOYMENT & UNEMPLOYMENT
IN INDIA – PROBLEMS AND
POLICIES
XI-Eco
Ch. 15

2. Introduction
 Employment :
 It refers to a situation when a person is able to
earn his livelihood either through self-
employment or by working as wage-employment.
 Unemployment:
 It refers to a situation when a person who is able
and willing to work does not get work at the
prevailing wage rate.

3. Employment: Trends & Structure
 Sharp decrease in the rate of employment
generation during mid-1990s.
Year %
1983-84 2
1993-94 1.25
Year %
1999-2000 1.25
2004-2005 2.62
Decrease Increase

4. Distribution of Total Employment by
Economical Sectors (%)
Sectors 1983-84 1993-94 2004-05
Primary 66 62 53
Secondary 14 15 18
Tertiary 20 23 29
0
10
20
30
40
50
60
70
1983-84 1993-94 2004-05
Primary
Secondary
Tertiary

5. Employment in Organized Sector
Unorganized
Sector:
whole of agriculture
and small-scale
industries, and most of
mining, construction,
trade, transport and
communications, social
and personal services.
Organized Sector:
Manufacturing Sector
(except small-scale
industries), electricity,
transport, financial
services and
government.

6. Observations:
1. Only about 7-8 % of the total employment in the
economy
2. Share in total employment has decreased steadily
from about 8% (1983) to 7% (2005).
3. Public sector
1. 68.8% (1983)
2. 71% (1994)
3. 68% (2007)
4. Public and Private sector combined also decline during
the period between 1994 and 2007 observed.
Year Persons Employed
(millions)
1983 24
1995 27.5
2000 28.1
2005 26.4
2007 27.2

7. Rural and Urban Employment
 Rural Areas:
 1980s: Increase (1.72% / annum)
 Sharp Increase in Govt. Expenditure:
1. Employment-oriented rural development programs
2. Expenditure on rural infrastructure
 1990s: Slowdown (0.47% / annum)
 Urban Areas:
 1980s: Increase (3.1% / annum)
 1990s: Sharp decrease (2.7% / annum)
Decrease in the growth rate of employment in organized sector: Partly due to
slowdown in the industrial growth but largely because of decline in
employment in the public sector in absolute terms

8. Meaning of Unemployment
 It’s a situation when there are some able-
bodied persons who have the ability to work
and are willing to work at the prevailing
wage-rate but are not able to find work which
may yield them some regular income.

9. Types of Unemployment
Developed
Countries
Cyclical Frictional

10. Types of Unemployment in India
Rural
Disguised Seasonal Educated

11. Types of Unemployment in India
Urban
Open Under Educated
Techno
logical

12. Extent & Magnitude
 Data about employment and
unemployment are provided by
1. The Census
2. National Sample Survey Organization
(NSSO)
3. Employment Exchanges
4. Central Statistical Organization (CSO)
5. Planning Commission

13. Extent & Magnitude
 Conventionally, unemployment estimates
relate to open unemployment only.
 But it’s not adequate since it doesn’t
include disguised unemployment.
FiveYear Plan Magnitude (In Million)
Beginning of the First Plan 3.3
Beginning of theThird Plan 7.1
Beginning of the Sixth Plan 12
Beginning of the Eight Plan 23
Beginning of the Ninth Plan 34

14. Extent & Magnitude
 NSSO has evolved standardized concepts and definitions of
unemployment .
 It has developed three main standardized concepts of
unemployment:
1. Usual Principal Status
2. CurrentWeekly Status
3. Current Daily Status
Year No. of UE UE Rate
1983-84 8 Million 2.88 %
1993-94 9 2.62
1999-2000 10.5 2.78
2004-05 13.1 3.06
 Usual Principal Status can be
considered as a measure of
chronic unemployment, while
CurrentWeekly Status and Daily
Status can be considered as a
proxy for seasonal unemployment
and underemployment.

15. Consequences of Unemployment
1. Wastage of Productive Resources
2. Loss of Resource Efficiency
3. Adverse effect on Saving & Capital
Formation
4. Source of Exploitation
5. Leads to Inequalities of Income
6. Burden on Government
7. Change inWork Attitude
8. Adverse effect on Individual’s Personality
9. Adverse Social and Political Effects

16. Causes of Unemployment
1. Slow rate of Economic Growth
2. Slow rate of Agriculture
3. Low Capital Formation
4. Rapid Population Growth
5. Use of Capital-intensiveTechniques
6. Defective Education System
7. Inadequate Employment Planning
8. Weak Manpower Planning
9. Decline of Cottage & Small-scale Industries
10. Rural-urban Migration
11. Labour Laws

17. Measures to remove Poverty
 Long-run Remedies
 High rate of economic growth
1. Sector with high emp. Potential
2. Produce commodities which have high emp. Intensity
3. Production technique
4. Fiscal & Monetary Policies
 Increasing investment
 Development of agricultural sector
1. Considerable Scope
2. High value & highly labour-intensive crops
3. Animal husbandry and fishery
4. Rural Development schemes
5. Labour-intensive techniques
6. Extension of social services Continue……….

18. Measures to remove Poverty
 Long-run Remedies
 Rural Industrialisation
1. Processing of Agricultural Produce
2. Encouraging Small-scale industries
3. Decentralization
4. Encouraging low Capital-intensive Techniques
 Creation of Self-employment opportunities
 Employment for the educated unemployed
 Manpower Planning
 Educational Reforms
 Greater emphasis on skill formation
 Control of Population Growth

19. Full Employment
 The situation when all those who wants &
able to do the work get the work

20. Thank You