Here is an essay on ‘Disguised Unemployment’ for class 9, 10, 11 and 12. Find paragraphs, long and short essays on ‘Disguised Unemployment’ especially for school and college students.
Essay on Disguised Unemployment
Essay # 1. Meaning and Characteristics of Disguised Unemployment:
Disguised unemployment characterises a situation when number of persons working on the field is more than the number actually required. As a result, marginal productivity of some workers is zero. In other words, if some workers are removed from the field, the total production would remain intact.
This type of situation is found in under-developed countries like India, where increasing population is absorbed in agricultural sector only. Thus, as is evident from the meaning of the term, though such persons seem to be employed on the face of things, but in reality they are unemployed in disguise.
Suppose a family has a farm of 15 acres. According to the methods used in cultivation, we suppose that 4 workers are sufficient to look after all the operations on the farm. Thus the family has 6 working members and if all of them are engaged on this farm, we can say that two of them are redundant. The total output will, thus remain unchanged even when two workers are taken away. These two persons are unemployed in disguise.
Almost all under-developed countries regarded surplus labour as a mere waste. This surplus labour was not only contributing anything to the country’s income, but on other hand was rendering the productive saving of the country as a mere waste in terms of consumption.
In recent years, a new thesis has been propounded by economists headed by Ragnar Nurkse. According to this, disguised unemployment implies a disguised saving potential and if proper efforts are made, it can be used for economic development. This is a potential source of capital formation.
According to Nurkse surplus labour or disguisedly unemployed labourers live with their kinfolk in joint family and are fed with the labour of their relations who are productive. Such unemployed persons in the joint family system and joint agricultural holdings, all the sons nephews, cousins and children work on the family land without ever bothering whether additional employment produces any extra output or not.
Characteristics of Disguised Unemployment:
1. It is confined to only those who are self-employed because the employed will not employ a labourer unless there is enough work to provide him with full employment.
2. It is invisible. In industrial countries, unemployment is a glaring waste of resources harmful to all. But in agricultural sector it is difficult to single out the disguisedly unemployed. This is why quantitative measurement of disguised unemployment is highly complicated. It is applicable in the Industrial sector also in times of deflation.
Essay # 2. Causes of Disguised Unemployment:
1. Rigidity of Essential Factors of Production:
National Endorsements like land and other gifts of nature are limited in quantity. They fail to cope up with the increasing tempo of population. Demographic theories testify that under developed country always suffers from explosure increase in manpower that is compelled to crowd over the limited natural resources.
2. Social Setup:
In countries where industrialist feelings are on the tide disguised unemployment does not occur but in countries where family trades predominates, disguised unemployment very often occurs because all members are engaged in the family trade.
3. Constant Technology:
In underdeveloped countries the technology of production is primitive. Hence the possibility of over employment beyond even solution point is possible. It is not possible in an economy where technologies fast changing.
Essay # 3. Measures for Removing Disguised Unemployment:
1. Prof. Nurkse has suggested that disguised unemployment is a blessing in disguise. The extra labour should be withdrawn and be engaged in new industries. Those workers will increase the output. The labourers will not be paid wages. The family output will feed these displaced labourers as before.
2. Population growth should be related through population planning control of immigrate encouraging migration with even distribution of population over region.
3. More virgin resources should be formed out within the economy. Industrial raw material is hidden in the country. Expert exploration can find it out where surplus labour may find work and contribute to the economic growth of the country.
4. Underdeveloped economies should not copy blindly the technology if the advanced economy. They should have judicious choice of technology. A balance should be struck out between the material resources and the labour force of the country otherwise disguised un-employment will take root.
Advanced technology may safely be introduced in promotion of basic industries. Labour-intensive techniques should be applied in consumption good industries.
According to Nurkse, the labour which is unproductive because of the state of disguised unemployment can be productively used with constriction of capital projects which would form capital assets and enhance the production capacity of the nation.
In the view of such surplus labour is taken away from agriculture and used for building of that capital project as dams for irrigation, roads, canals, bridges etc. this labour becomes productive and adds to the ‘Capital Stock’ of the nation.
Essay # 4. Difficulties in Mobilisation of Saving Potential in India:
There are a number of practical difficulties in using disguisedly unemployed workers:
1. These workers are mostly unskilled but capital formation requires both skilled and unskilled persons.
2. If vertical saving is to be effective saving through the utilisation of disguised unemployed persons, there should not be any leakage of un-substance fund. By transferring some persons to other occupations those who used to support the dependents may also increase their consumption.
3. Nurkse himself said that disguisedly unemployed are incapable of personal identification by the very definition of disguised unemployed but he did not realise the implication of this. For lack of personal identification we shall have to rely upon the labour market and wage shall have to be paid to employ labour on capital projects.