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What is disguised unemployment?
  • a)
    When workers are fully employed but underpaid
  • b)
    When workers are employed but their skills are not fully utilized
  • c)
    When workers are unable to find any work at all
  • d)
    When workers receive high wages but are overworked
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
What is disguised unemployment?a)When workers are fully employed but u...
Disguised unemployment occurs when workers are employed but their skills are not fully utilized. This often happens in situations where more workers are employed than needed, leading to underutilization of labor. For example, if more people work on a farm than necessary, some workers may be underemployed.
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What is disguised unemployment?a)When workers are fully employed but u...
Understanding Disguised Unemployment
Disguised unemployment occurs when individuals are employed but their skills and abilities are not fully utilized in their job roles. This phenomenon is significant in economies where the labor market does not effectively match workers with appropriate jobs.
Key Characteristics of Disguised Unemployment:
- Underutilization of Skills: Workers may possess qualifications or skills that are not being used effectively in their current positions. For example, a highly educated individual working in a low-skilled job reflects disguised unemployment.
- Economic Impact: Disguised unemployment can lead to lower overall productivity in the economy since the potential contribution of skilled workers is not realized. This can hinder economic growth and innovation.
- Difficult to Measure: Unlike traditional unemployment, which can be quantified easily by counting those without jobs, disguised unemployment is harder to detect. Individuals are technically employed, yet their work does not reflect their true capabilities.
- Examples in Various Sectors: Common in sectors like agriculture, where many workers may be engaged in low-productivity tasks, or in industries where workers are overstaffed yet not effectively utilized.
Conclusion:
Disguised unemployment highlights inefficiencies in the labor market and signals a need for better job matching and skill development. Addressing this issue is crucial for enhancing productivity and economic stability.
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