Unemployment – Under – Employment (Disguised Unemployment)

Under-employment is also sometimes called disguised unemployment when an individual or group does not have a job or appears to be unemployed. Read about it’s effects.

Regarding the Indian economy, under-employment can be said to be a situation when an individual is not fully employed permanently for the duration of time. Under-employment is also sometimes called disguised unemployment when an individual or group does not have a job or appears to be unemployed. This article is based on under-employment in terms of the Indian economy. This article also revolves around disguised unemployment and its definition considering the Indian scenario.

Indian economy

The Indian economy is said to be developing a mixed economy. In terms of GDP, the Indian economy is ranked as the sixth-largest economy in the world. In terms of PPP (Purchasing power parity) India is ranked as the third largest country in the world. The GDP of India is estimated to be approximately 3.25 trillion dollars in 2022. Indian economy is termed as developing based on low economic criteria due to low per capita income and huge population of India. Base of the Indian economy is considered agriculture. Apart from that poor infrastructure equally participates in making the Indian economy develop. 


Unemployment is a state or condition when an individual is searching for a job and is unable to get any of them related to their educational background or other skills. Unemployment is often used to measure the health and economy of a country. The Indian economy is a developing economy as it creates an average number of employment. Types of unemployment can be stated as :

  • Under-employment
  • Disguised unemployment
  • Seasonal unemployment
  • Structural unemployment

Concept of under-employment

Under-employment is defined as a condition in which an individual is hardly getting any job provided that if they manage to get some job it lasts for only a few days. In India, people who are getting less paid and not doing enough work by utilising their abilities and skills are called underemployed. As the Indian economy is mostly dependent on agricultural work, the majority of people here are involved in agricultural activities. It is found that all members of a farmer family are involved in agricultural activities by producing crops over some land area. All members of the family do not get work for a whole year; rather they work only in agricultural season. For the rest of the agricultural season, they stay at home being unemployed. This situation of unemployment is considered as under-employment. 

In ancient times, people were engaged in hunting and gathering activities for collecting foods and necessary things for their survival. Until now most of the Indian population is practising agricultural activities to produce food and other crops. The only difference found is that people are doing agriculture for earning through being employed under large farmers.

Effects of under-employment

Considering the Indian economy, under-employment reveals the best way to utilise the labour force in terms of ability, skills, and work experience.

  • Workers are forced to work for low pay scales or in low skilled jobs.
  • It creates a burden not only over the family but also to the government. 
  • Under-employment affects the per-capita income of the population. It decreases the per capita income of a country, which is harmful for any economic growth.
  • Under-employed workers are found frustrated at their workplace. 

Definition of disguised unemployment

Disguised unemployment definition can be stated as a type of unemployment where too many individual workers are filled with few job requirements. Disguised unemployment cab leads to low productivity. In this unemployment, workers’ skills are not utilised for producing any goods or services. Researchers have analysed that disguised unemployment does not contribute to the output of an economy. 

Types of disguised unemployment

  • Unemployment
  • An individual not looking for a job for more than years
  • Disabilities and illness


It is to be concluded from the above study that the Indian economy is a type of developing economy. It is observed that the Indian economy mainly depends upon agricultural activities. The majority of the Indian population are involved in agricultural work, where they are employed for a short duration of time. People involved in agricultural activities can be employed for only agricultural season instead of full-time employment, thus it is considered as under-employment. Cyclical unemployment can be considered as employment in which more people are employed for fewer requirements.