Question

What is disguised unemployment?

Answer 1

Hidden unemployment or disguised unemployment is a kind of unemployment where some people seem to be employed but are not. This usually occurs when there is over-employment in a particular sector. This basically means that on paper you can show employment but in reality, too many have been hired to do a job that can be done by fewer people.

When people can’t find jobs that employ their skills or education to full capacity, they still have bills to pay, so they settle for lesser responsibilities, known as “underemployment.”

For example, in the rural areas per agricultural sector, where ten members of a farmer family are employed on small farm plots when five are enough. Those extra 5 members are unemployed rather than being employed.