Unemployment in developing countries

The volatility of local economies in an era of recurrent global economic crisis may have solidified the disadvantaged status of young people within the larger economies. Understanding youth labor outcomes in developing countries may offer new perspectives for policy makers as well as help to unmask chronic problems in our economic systems and give direction to further studies concerning the youth labor market. One might expect that declines in the size of the youth cohort observed in the past two decades would have contributed positively to labor outcomes of youth in developing countries.

Unemployment in developing countries

Let us make in-depth study of the meaning, types and nature of unemployment in developing countries. Technically speaking, unemployment is defined as a state of affairs when in a country there are a large number of able-bodied persons of working age who are willing to work but cannot find work at the current wage levels.

Unemployment in developing countries

Mere engagement in some productive occupation does not necessarily mean absence of unemployment. People, who are only partially employed or are engaged in inferior jobs, though they can do better jobs, are not adequately employed.

It is called a state of underemployment which is equally bad for the prosperity of a country. Under capitalism, it seems some amount of unemployment is inevitable. The best that can be done is to keep the number of the unemployed as low as possible. There are three main types of unemployment: In order to understand the concept of full employment the difference between these types of unemployment needs to be grasped.

Promoting Jobs, Protecting People

There is always some minimum amount of unemployment that prevails in the economy among workers who have voluntarily quit their previous jobs and are searching for new better jobs or looking for employment for the first time.

They are said to be between jobs. They are not able to get jobs immediately because of frictions such as lack of market information about availability of jobs and lack of perfect mobility on the part of workers. The distinguishing feature of frictionally unemployed persons is that the number of job vacancies equal to them are available in the economy.

They remain unemployed for a relatively short period of time before they are able to get new jobs. This is because some time is required for job searchers to have information about the availability of jobs. When presently fractionally unemployed persons get jobs, the new frictionally unemployed persons come into existence and thus there is always some frictional unemployment prevailing in the economy due to imperfections or lack of market information about the availability of jobs.

Since frictionally unemployed are those who have either quit their old jobs voluntarily and are looking for better jobs or those who have entered into the labour force for the first time and searching for jobs according to their acquired skills or those who had re-entered the labour force for some time, for example, after having children, the frictional unemployment is considered as voluntary unemployment.

Structural unemployment is another type of unemployment which always exists to some extent in a growing economy. Structural unemployment which refers to the mismatch between the unemployed persons and the demand for specific types of workers for employment occurs because whereas demand for one kind of labour is expanding, the demand for another kind of labour is declining either due to the changes in the structure i.

Unemployment in Developing Countries: Causes and Nature

The distinguishing feature of structural unemployment is that the unemployed workers lack skills required by the expanding industries.

Structural unemployment also occurs because of the mismatch between the location of job vacancies of the expanding industries and the present location of the unemployed workers. Let us give an example of structural unemployment.

In a growing economy techniques of production are constantly changing with the result that people are likely to lose their jobs when these are replaced by newer and more efficient techniques.

Unemployment in Developing Countries

The unemployment created in this way is structural unemployment and is inevitable consequence of technological progress. These structurally unemployed persons will need to acquire new skills and training before they will be absorbed in the new technologically superior jobs.

Take another example, when computerization of banks, offices occurred in India recently some workers were rendered unemployed. But computerization created new job opportunities.

On being given training in computer operations some of them again got jobs. But for some time they remain unemployed.Unemployment rate per country in This is a list of countries by unemployment rate.

Methods of calculation and presentation of unemployment rate vary . Most of the unemployment in underdeveloped countries is of a different nature from that in advanced and developed countries. A major part of unemployment in present-day developed countries is of cyclical nature which is due to deficiency of aggregate effective demand.

But most of the unemployment in developing countries is not cyclical. Thus, . Unemployment in Developing Countries: Causes and Nature! Most of the unemployment in underdeveloped countries is of a different nature from that in advanced and developed countries.

A major part of unemployment in developed countries is of cyclical nature which is due to deficiency of aggregate effective demand. 18 economically advanced and 23 developing countries were conducted to test the impact of changes in the size of the youth cohort on youth employment and unemployment controlling for .

Thus, in developing countries, there is not much Keynesian type short-term unemployment. Instead, it is a chronic problem.

Causes: Causes of Unemployment in Developing Countries: We have explained above the two basic explanations of unemployment and under employment prevailing in the developing countries. We now . In many developing countries, unemployment is low simply because few people can afford it.

Jobless benefits are patchy. In their absence, most people have to eke out a .

Unemployment in developing countries
List of countries by unemployment rate - Wikipedia