As we all are aware, unemployment is a very serious issue not only in India but in the whole world and also more crucial during the COVID-19 pandemic. There are hundreds and thousands of people who do not have employment or jobless. Besides, the problems of unemployment are very severe in India because of the growing population the demand for jobs increases. Moreover, if we neglect this problem then soon it will be going to become the reason for the doom of the nation.

Unemployment in India, statistics have traditionally been collected, compiled and disseminated once every five years by the Ministry of Labour and Employment (MLE), primarily from sample studies conducted by the National Sample Survey Office. Also, the Centre for Monitoring Indian Economy Private Limited (CMIE), a non-government private entity, started to survey and publish monthly unemployment data for the first time in Indian history in 2016.

Types of Unemployment

• Frictional Unemployment: It is a type of unemployment that arises when workers are searching for new jobs or are transitioning from one job to another. It is part of natural unemployment and hence is present even when the economy is considered at full employment.
• Cyclical Unemployment: It is a type of unemployment that is related to the cyclical trends in the industry or the business cycle. If an economy is doing well, it will be at its lowest and will be the highest if the economic growth starts to falter. If cyclical unemployment is rising, it also means that the economy is showing signs of slowdown which is not good. The lack of demand means that there is not enough consumption. The government would then need to address the issue by various fiscal and monetary policies to support the economy.
• Structural Unemployment: It is a longer-lasting form of unemployment caused by fundamental shifts in an economy and exacerbated by extraneous factors such as technology, competition, and government policy. Jobs are available, but there is a serious mismatch between what companies need and what workers can offer.
• Institutional unemployment: It is unemployment due to interferences with free-market conditions rather than the voluntary decisions of those unemployed. Such interferences include all attempts to raise wage rates above the flexible rates which are a free market tend to adjust the supply of every type of labour to the demand for it. Such interferences are usually the result of so-called ‘pro-labour’ legislation, although they may also be the result of custom, union activity, or fear of violence.

Reasons for Unemployment

In a country like India, there is much reason for a large section of the population for being unemployed. Some of these factors are: 

• Caste System
• Slow Economic Growth
• Increase in Population
• Agriculture is a Seasonal Occupation
• Joint Family System
• Fall of Cottage and Small industries
• Slow Growth of Industrialization
• Fewer Savings and Investment
• Causes of Underemployment
• Defective Planning
• Expansion of Universities
• Inadequate Irrigation Facilities
• Immobility of labour

Consequences of Unemployment

There are many types of unemployment (Rural unemployment; disguised unemployment; seasonal unemployment; urban unemployment; Industrial unemployment; Educated Unemployment) which exist in India and the root cause of problems like poverty in India.

Thus the economic consequences of unemployment are:-

1. Non-utilization of manpower; human resources are not fully utilized. It is sheer wastage for society.
2. Loss of output in the economy because unemployed persons only live as consumers, not as producers.
3. Thus living only as a consumer will add up the consumption, not the production. They don’t earn nor do they save for investment; thus capital formation is low.
4. Due to disguised unemployment, there is a low level of productivity which implies lesser surplus from the output for the future generation.

Thus these consequences lead to not only a low level of present output but also a low level of future output because of lesser surplus for future investment. The social consequences of unemployment are: 

1. Unemployment leads to a low quality of life which leads to the state of perpetual suffering.
2. Higher the degree of unemployment; higher will be the inequality in the distribution of income and wealth.
3. Unemployment divides the Soviets into having or have not. Accordingly, a class conflict that compounds the problem of social unrest.
4. Unemployment leads to the vicious circle in society by causing problems like illiteracy; poverty; etc.

Thus social consequences of unemployment are that it is a social menace as it denies social justice and enhances social unrest by increasing the disparity between having and haven’t.

Thus unemployment affects a lot to the economically and socially and still is a reason for concern for our leaders to how to get rid of this problem.

Initiative by Government

· IRDP (Integrated Rural Development Programme)

· DPAP (Drought Prone Area Programme)

· JawaharRozgarYojana

· Employment Assurance Scheme

· NRY (Nehru RozgarYojana)

· Training for self-Employment

· PMIUPEP (Prime Minister’s Integrated Urban Poverty Eradication Program)

· Employment exchange

· Employment Guarantee Scheme

· Development of the organized sector

· Small and cottage industries

· Employment in forging countries

· Jawahar Gram SamridhiYojana and few more.

These are the schemes started by the government over the last few years. But due to pandemic India’s institutional focus on its youth has always been relatively weak. According to data, Union budgets of the last five years shows that India spends less than 4 per cent of its annual budget on youth-focused schemes, and the proportion of funding allocated to these schemes has declined in recent years. Besides, the government also makes some rules flexible, so that employment can be created in the private sector also.

We can say that the problem of unemployment in India has reached a critical stage. But, now the government and local authorities have taken the problem seriously and provide internship and on-site vocational training to unemployed youth in incentivizing companies and industrial units. This experience can be combined with distance education to teach the trainees relevant theories and concepts. In the interim, the government should fill a large number of vacant posts. There are more than 22 lakh vacancies in government departments, as per current record. The country can ill-afford this neglect at a time when the unemployment rates remain very high.