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Differenciate between open unemployment and disguised unemployment? Give a brief answer of at least 5 points?
Verified Answer
Differenciate between open unemployment and disguised unemployment? Gi...
Open unemployment:
1-Open employment refers to the situation in which an individual has no job and unable to earn his livelihood.
2-This unemployment is clearly visible.
3-People’s unemployment will affect the production of goods and services in an economy.
4-country’s labour force do not get opportunities for adequate employment
5-In Open Employment the landless agricultural labourers in rural areas faces this.

Disguised unemployment 

1-Disguised unemployment refers to the situation in which people work at a place where there is no more people are required.
2-This unemployment is hidden.
3-People’s unemployment won’t affect the production of goods and services because here already more than requirement of people are working so if they leave that’s not a big deal
4-The work is not constantly available or too many people are employed for the same work that does not require so many hands.
5-This is generally found in unorganized sector where either work is not constantly available or too many people are employed for the same work that does not require so many hands.
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Most Upvoted Answer
Differenciate between open unemployment and disguised unemployment? Gi...
Open Unemployment:-
Under this, the worker is ready to work, but he is unable to find any work. It can occur in any sector.
Disguised Unemployment:-
Under this, more workers are employed than the requirement so the workers are working but all of them are made to work less than their potential. Under this, if the extra workers are removed the production does not fall. It occurs mainly in agriculture.
Community Answer
Differenciate between open unemployment and disguised unemployment? Gi...
Open Unemployment:
Open unemployment refers to a situation where individuals are willing and able to work but are unable to find suitable employment opportunities. It is characterized by the presence of unemployed individuals actively searching for work.

Disguised Unemployment:
Disguised unemployment, on the other hand, is a situation where individuals appear to be employed but are actually underemployed. It occurs when a larger number of people are engaged in a particular activity than is necessary for its efficient functioning.

Now let's differentiate between open unemployment and disguised unemployment:

1. Nature of Unemployment:
- Open unemployment is the absence of employment opportunities, resulting in people being jobless and actively seeking work.
- Disguised unemployment involves individuals who are employed but their contribution to the overall output is minimal or unnecessary.

2. Visibility of Unemployment:
- Open unemployment is easily observable as individuals are actively searching for work and usually registered with employment agencies or actively seeking jobs through various channels.
- Disguised unemployment is less visible as individuals may appear to be employed, but they are not fully utilizing their skills or contributing significantly to the productivity of the activity they are engaged in.

3. Degree of Utilization:
- Open unemployment represents a complete underutilization of labor resources, as individuals are completely idle and not engaged in any productive activity.
- Disguised unemployment represents a partial underutilization of labor resources, as individuals are engaged in an activity but their contribution is redundant or excessive compared to the actual requirements.

4. Impact on Productivity:
- Open unemployment leads to a decline in overall productivity as potential labor resources remain untapped and unused.
- Disguised unemployment may not have a significant impact on productivity in the short term, as the individuals involved are already part of the workforce. However, in the long run, it can hinder productivity growth and efficiency.

5. Policy Implications:
- Open unemployment necessitates policy interventions such as job creation, skill development, and investment in sectors with potential for employment generation.
- Disguised unemployment requires policy measures focused on improving the efficiency of the labor market, promoting entrepreneurship, and facilitating the transition from low-productivity activities to higher-value sectors.

In conclusion, open unemployment and disguised unemployment differ in terms of the nature of unemployment, visibility, degree of utilization, impact on productivity, and policy implications. While open unemployment represents the absence of employment opportunities, disguised unemployment involves underemployment and inefficient utilization of labor resources. Both forms of unemployment require targeted policy interventions to address the associated challenges and promote sustainable economic growth.
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