Unemployment — Types, Measurement, and Schemes

5.1 Types of Unemployment in India

1. Open Unemployment: Actively seeking work but unable to find — measured by PLFS (Periodic Labour Force Survey)

2. Disguised Unemployment (Underemployment): More workers than needed for a job — common in Indian agriculture; marginal productivity of excess workers is near zero

3. Seasonal Unemployment: Agricultural workers unemployed during off-season (6 months in many states)

4. Structural Unemployment: Skills mismatch — workers with outdated skills cannot find jobs in evolving economy; especially relevant as India transitions to digital economy

5. Cyclical Unemployment: Demand-deficient unemployment during economic downturns

6. Frictional Unemployment: Normal unemployment due to job search time between jobs

7. Educated Unemployment: Unemployment among degree holders — India-specific paradox where higher education sometimes reduces employability in jobs available

5.2 Labour Market Data (PLFS 2023-24)

Periodic Labour Force Survey (PLFS) is NSSO's quarterly survey (urban) and annual survey (rural+urban). Key metrics:

Indicator	Value (2023-24)
Labour Force Participation Rate (LFPR)	55.2%
Worker Population Ratio (WPR)	52.2%
Unemployment Rate (UR)	5.1% (all-India)
Urban Unemployment Rate	6.7%
Rural Unemployment Rate	5.8%
Female LFPR	41.7% (improved from 23% in 2017-18)
Youth Unemployment (15-29 years)	~17-18%

Key Improvement: LFPR has risen from 49.8% (2017-18) to 55.2% (2023-24) — primarily due to female LFPR improvement in rural areas through self-employment and MGNREGS.

5.3 Employment Schemes

MGNREGS (Mahatma Gandhi National Rural Employment Guarantee Scheme):

• Enacted under MGNREGA 2005 — legal right to work
• 100 days unskilled work per rural household per year
• If employment not provided within 15 days → unemployment allowance paid
• Works focus on water conservation, land development, rural connectivity
• FY2024-25 data: 2.98 billion person-days; 57% women workers; Rs 86,000 crore budget (2025-26)
• Wage rates: Notified state-wise minimum wage; Rs 267 (Bihar) to Rs 374 (Haryana) per day in FY2024-25

PM Garib Kalyan Rozgar Abhiyan (2020): Emergency employment for returning migrant workers during COVID-19 — Rs 50,000 crore, created employment in 25 districts across 6 states.

PM Employment Generation Programme (PMEGP):

• Credit-linked subsidy for micro enterprises (manufacturing + service)
• Subsidy: 15-35% of project cost (higher for rural, SC/ST, women)
• Target: Rs 35 lakh crore projects funded; 8 lakh enterprises/year; 64 lakh jobs created since 2008

Atmanirbhar Bharat Rojgar Yojana (ABRY):

• EPFO-based incentive — government pays both employer + employee EPFO contributions (24% of wages) for 2 years for new hires
• Benefited 1.31 crore employees through 1.52 lakh establishments (2020-22)

PM Internship Scheme (Budget 2024-25):

• Internship for 1 crore youth in 500 top companies over 5 years
• Rs 5,000/month stipend (company Rs 4,500 + government Rs 500)
• Companies bear training costs via CSR funds

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