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Unemployment UPSC NOTE


  • Report released by the International Labour Organization (ILO) and the Institute for Human Development (IHD) revealed that two out of every three unemployed individuals was a young graduate

  • Out of the 27 States considered, 12 States have unemployment rates less than the national average (Manipur is not included here since field work was not completed owing to the conflict)

  • Top 4 states with high unemployment rates across Indian States in 2022-23 : Goa, Kerala, Haryana and Punjab are comparatively richer states

  • In states where a large proportion of the labour force is engaged in self-employment, the unemployment rate is low

  • Since a bulk of the self-employment in India is of the informal variety, States with a large proportion of informal work would find it easy to absorb a large number of job-seekers

  • A large proportion of informal self-employment is accounted for by agriculture and the rural economy.

  • There is a clear positive relation, indicating an increase in unemployment rates in highly urbanised States. 

  • This explains the high degree of unemployment in States like Goa and Kerala — both highly urbanised — and low unemployment in States like U.P., Jharkhand and Madhya Pradesh

  • Urbanised States have smaller agrarian and agrarian-dependent sectors and hence have a relatively smaller source of informal jobs available. 

  • While informal sectors do exist and thrive in urban settings, the scope for the absorption of job-seekers is limited as compared to rural agriculture, which often acts as a ‘reserve’ absorbing surplus labour.

Reasons for Unemployment

  • Perhaps graduates do not possess the requisite skills required for the growing modern sector. 

    • This necessitates a focus on teaching infrastructure and standards

  • Graduates seek high-wage jobs in line with their skills, and not informal jobs. 

  • If the modern sector does not expand sufficiently to absorb new graduates, it would result in unemployment.

  • Inadequate State policies on curbing the issue

  • As India develops, an increase in urbanisation and educational attainment would add an upward pressure to the unemployment rate. 

  • It is imperative that policy concentrates on the question of employment generation to counter these tendencies



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Learnerz IAS | Concept oriented UPSC Classes in Malayalam: Unemployment UPSC NOTE
Unemployment UPSC NOTE
Learnerz IAS | Concept oriented UPSC Classes in Malayalam
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