Employment, Unemployment Skills and Labour in India

In this post, we are providing the Notes on Employment and Unemployment in india pdf – Indian skill workers development organization – unemployment skill development – Phillips Curve.

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Employment refers to the state of having a job or being employed, while unemployment refers to the state of not having a job or being without employment despite actively seeking work.

Types of Unemployment

The main types of unemployment are:

  1. Frictional unemployment: This occurs when workers are between jobs or searching for new employment opportunities.
  2. Structural unemployment: This occurs when changes in the economy or labor market make certain skills or industries obsolete, leading to a mismatch between available jobs and the skills of workers.
  3. Cyclical unemployment: This occurs when there is a downturn in the economy, resulting in decreased demand for goods and services, and a subsequent decrease in demand for workers.
  4. Seasonal unemployment: This occurs when employment is tied to specific seasons or times of the year, such as in the agricultural or tourism industries.
  5. Voluntary unemployment: This occurs when workers choose not to seek employment, often due to personal reasons or the availability of other sources of income.

Unemployment skill development

Unemployment skill development refers to programs and initiatives designed to provide job seekers with the skills and training needed to secure employment in various industries. These programs are designed to address the skills gap that exists in many industries, where there is a shortage of skilled workers with the expertise needed to perform in-demand jobs.

Unemployment skill development programs may include vocational training, apprenticeships, on-the-job training, and other forms of skills development. These programs may be offered by government agencies, non-profit organizations, or private sector companies. The goal of these programs is to help job seekers gain the skills and experience needed to compete for jobs in the labor market and ultimately reduce the unemployment rate. By providing training and support to unemployed workers.

Natural Rate of Unemployment(Full Employment)

The natural rate of unemployment, also known as the full employment rate, is the lowest level of unemployment that can be sustained in an economy without triggering inflation. This rate is achieved when the labor market is in balance, with the number of job openings and job seekers roughly equal. At the natural rate of unemployment, all individuals who are willing and able to work are employed, but there remains some level of unemployment due to factors such as frictional and structural unemployment. Policymakers often aim to maintain the economy at or near the natural rate of unemployment to achieve stable economic growth and avoid inflationary pressures.

Causes of Unemployment

Unemployment can be caused by a variety of causes, including:

  1. Economic conditions: Unemployment can be caused by downturns in the economy or changes in industries, leading to a decrease in demand for labor and job losses.
  2. Technological advancements: Advances in technology can lead to automation and the replacement of human labor with machines, resulting in job losses.
  3. Policy choices: Government policies such as minimum wage laws, taxes, and regulations can impact employment levels by affecting the cost of labor or the ease of doing business.
  4. Globalization: International trade and competition can impact employment levels by creating winners and losers in the global economy.
  5. Seasonal factors: Some industries experience seasonal fluctuations in demand for labor, leading to temporary unemployment during certain times of the year.

Consequences of Unemployment

Unemployment can have several negative consequences on individuals, families, and society as a whole, including:

  1. Financial hardship: Unemployed individuals may struggle to meet basic needs such as food, housing, and healthcare, and may face financial instability.
  2. Social isolation: Unemployment can lead to social isolation and a loss of social networks, which can have negative effects on mental health.
  3. Reduced productivity: Unemployment can lead to a decrease in overall economic productivity, as individuals who are not working are not contributing to the economy.
  4. Increased government spending: High levels of unemployment can lead to increased government spending on social welfare programs, such as unemployment benefits, which can strain government budgets.
  5. Crime: Unemployment can lead to an increase in crime rates, as individuals who are financially and socially marginalized may turn to illegal activities to meet their basic needs.

Indian skill workers development organization

The Indian government has established several organizations to promote skill development and vocational training in the country, including the National Skill Development Corporation (NSDC) and the Skill India Mission.

The NSDC is a public-private partnership that works to promote skill development by partnering with private training providers, industry associations, and other stakeholders. It also provides financial support to individuals and organizations to help them acquire new skills and improve their employability.

The Skill India Mission is a national initiative launched by the Indian government to create a skilled workforce and meet the needs of various sectors. The mission aims to train more than 40 crore people in India in various skills by 2022, through a range of programs, including apprenticeships, vocational training, and entrepreneurship development.

Formal, Informal, Organized, and Unorganized Economy

The economy can be broadly classified into formal and informal sectors and organized and unorganized sectors:

  1. Formal economy: The formal economy includes activities that are officially recognized and regulated by the government, and typically involves registered businesses, formal contracts, and official financial transactions.
  2. Informal economy: The informal economy includes activities that are not officially recognized or regulated by the government, and typically involves unregistered businesses, informal contracts, and cash transactions.
  3. Organized economy: The organized economy includes activities that are conducted within formal and regulated sectors, and typically involves established businesses, labor contracts, and compliance with government regulations.
  4. Unorganized economy: The unorganized economy includes activities that are conducted within the informal and unregulated sectors, and typically involves small-scale or unregistered businesses, casual labor, and a lack of government oversight.

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Phillips Curve

The Phillips curve is a graphical representation of the inverse relationship between the rate of unemployment and the rate of inflation in an economy. The curve suggests that when unemployment is high, there is a lower rate of inflation, and when unemployment is low, there is a higher rate of inflation. This relationship is based on the idea that as the economy approaches full employment, firms must compete for labor, driving up wages and ultimately leading to higher prices for goods and services. The Phillips curve is named after economist A. W. Phillips, who first observed the relationship between unemployment and inflation in the 1950s.

Jobless Growth

Jobless growth refers to a situation where an economy experiences economic growth but does not create a significant number of new jobs, or where job creation lags behind economic growth. This phenomenon is often seen in industries that have undergone technological advances or automation, leading to increased productivity but decreased demand for labor. Jobless growth can have negative social and economic consequences, including increased income inequality, social unrest, and decreased consumer spending.

Labour Productivity

Labour productivity refers to the amount of output that can be produced by a worker in a given period of time, typically measured as output per hour worked. It is a key measure of economic efficiency and can be influenced by factors such as technology, education and training, and management practices. High levels of labor productivity can lead to increased economic growth and competitiveness, as well as higher wages and living standards for workers.

Labour Law Reforms

Labour law reforms refer to changes made to the legal framework that regulates the relationship between employers and employees. These reforms may be aimed at modernizing and updating existing labour laws, addressing emerging issues in the workplace, or improving the overall functioning of the labour market.

Child Labour in India

Child labour is a major issue in India, where millions of children are engaged in work that is harmful to their health, education, and overall well-being. Many of these children work in industries such as agriculture, mining, and textiles, as well as in domestic service, street vending, and other informal sectors. Child labour is a violation of human rights and can have serious long-term consequences for the physical and mental health, education, and social development of children.

Causes of Child Labour

The causes of child labour are complex and multifaceted. Some of the main causes that contribute to the persistence of child labour in India and other countries include:

  1. Poverty: Many families living in poverty rely on the income earned by their children to meet basic needs such as food, shelter, and clothing.
  2. Lack of education: Children who do not have access to education or drop out of school are more likely to engage in work to support themselves and their families.
  3. Discrimination: Children belonging to certain groups, such as girls, Dalits (formerly known as untouchables), and other marginalized communities, are more likely to be subjected to child labour.
  4. Weak labour laws and enforcement: Inadequate laws and poor enforcement make it difficult to prevent and eliminate child labour in many parts of the world.
  5. Demand for cheap labour: In some industries, such as agriculture, mining, and textiles, employers rely on child labour to keep production costs low.

Constitutional Protection for Children

The Constitution of India provides several provisions for the protection of children’s rights, including:

  1. Right to Education: The Right to Education Act, of 2009, guarantees free and compulsory education to all children between the ages of 6 to 14 years.
  2. Protection from exploitation: Article 24 of the Constitution prohibits the employment of children below the age of 14 years in hazardous occupations.
  3. Protection from abuse and neglect: Article 15(3) of the Constitution allows the government to make special provisions for children and other vulnerable groups to protect them from abuse, exploitation, and neglect.
  4. Protection from trafficking: The Immoral Traffic (Prevention) Act, of 1956, prohibits the trafficking of children for prostitution or any other immoral purpose.
  5. Protection from forced labour: Article 23 of the Constitution prohibits forced labour, including child labour.

Employment and Unemployment in India pdf

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FAQs on Employment, Unemployment Skills and Labour in India.

What is Unemployment?

Unemployment is a state in which people who are able and willing to work are unable to find jobs.

What is Labour productivity?

Labour productivity refers to the amount of output that is produced by an individual worker or a group of workers in a given amount of time.

Who is A. W. Phillips?

A. W. Phillips is known for his pioneering work on the relationship between inflation and unemployment, which is now known as the Phillips Curve.

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Last updated: August 14, 2023 Updated on 10:19 AM