Employment generation has been one of the important objectives of development planning in India. The problem of employment is closely interlinked with the eradication of poverty. There are three main aspects of the employment problem in India. They are the problem of proportion of labour to total population, problem of productivity of labour and problem of unemployment and underemployment of labour. These three aspects are interrelated. There is low rate participation of labour in India. Low rate of employment among women is a striking feature in India. There has almost been no change in LFPR (labour force participation rate). The dependency rate is quite high in India. Problem of unemployment and underemployment is the chronic feature of the Indian economy. It is the main cause of poverty in India. Unemployment in India is mostly structural. The rate of unemployment is different in different states. Sector wise unemployment in India is rural and urban unemployment.
Urban unemployment is of two types viz, industrial unemployment and educated unemployment. Rural unemployment is more than 70% as rural population is more than 70% of the total population in India. There are various types of unemployment in India. They are seasonal, structural, frictional, technological, involuntary and disguised. The productivity criterion refers to disguised unemployment. It is mainly found in agriculture. It is a kind of underemployment. It involves both zero marginal productivity of man hour and zero marginal productivity of labour. It implies too many persons on too little land. Educated unemployment is one variant of open unemployment. It is mainly due to the defective educational system. Underemployment is one variant of open unemployment.
It is mainly due to the defective educational system. Underemployment may be visible or invisible. The ratio between unemployed workers and total labour force is called unemployment rate. Low productivity of employment is the third aspect of the employment problem. Productivity of labour in India is low due to many factors. The essential of the employment policy is to increase production, control population growth, reform the education system, emphasize cottage and small scale industrial units to tackle the problem of seasonal, frictional, structural, technological and disguised unemployment and effectively do manpower planning etc. There have been various schemes to solve the problem of educated unemployment.
A series of anti poverty employment programmes like PMRY have been launched for the solution of the problem of educated unemployment. Poverty and inequality are interlinked. Poverty can be defined as subsistence, inequality and externality. In the absolute sense, it relates to subsistence. It relates to the minimum standard of living. In the relative sense, poverty means difference in the relative standard of living of the people. It relates to inequality in the level of living. We in India are mostly concerned with absolute poverty. The concept of poverty line has been used to know the extent of poverty in a country. People below the poverty line suffer from absolute poverty. Control of population growth, higher economic growth and income redistribution etc. are the most important measures of eradication of poverty. Various anti poverty measures have been taken during the plan period starting from the first to the 9th five year plan. Various special anti poverty employment programmes. Like JRY, NRY etc. have been launched from time to time. Various social security measures like NOPS, ESIC etc. have been launched.
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Inequality exists both in developing and developed economies. Economic inequality is one of the causes of mass poverty, Inequality is basically due to mal distribution of national income. There are three forms of economic inequality. They are inequality of assets, inequality of income and consumption and regional inequality. These three major forms of inequalities are inextricably interlinked and reinforcing. Inequality and poverty are also interconnected and like poverty inequality is also bad. Suitable measures should be taken with a view to reducing existing economic inequality if not removing it.