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1) Indroduction of Rural Unemployment

In a common sense, unemployment is a situation characterized when any one
is not gainfully employed in a productive activity. It means that an
unemployed person is one who is seeking any work for wages but is unable to
find any job suited to his capacity. From this view one can easily make an idea
of voluntarily and involuntarily unemployed.

Obviously, in an economy, there is a section of working population who is not

interested in any gainful job and still others are interested in employment at
wage rates higher than those prevailing in the labour market.

Prof. Keynes calls this type of labour force as voluntarily unemployed.

According to him, involuntarily unemployment refers to a situation in which
people are ready to accept work at prevailing wage rate but fail to get the same

“Various experts have undertaken studies regarding the period of

unemployment in different parts of the country which showed that enforced
unemployment lasts on an average from 150 to 270 days in a years. For
example, income of the South Indian villages, the cultivators have little or no
work on the field for three months in the year at a stretch. In Tamil Nadu, the
cultivators find employment only for about 6 months, while in Bengal for
about three to four months in a year. Jute growers were idle for 9 months
while the paddy growers for 7½ months. In Oudh, the cultivator got
employment from 150 to 20o days. In the submontane districts of U. P. the
cultivator was engaged for 110 days’ full labour and 188 days’ complete leisure.
In the Bombay Deccan, the cultivator had work only for 180 to 190 days. In the
Punjab, the cultivators had work for 160 to 278 days. In Kerala the agricultural
labourer finds employment only for 160 to 240 days; while in Delhi villages
there was no work for more than 5 months.”

According to the Agricultural Labour Enquiry Committee Report, “the extent

of under-employment is on the average, 82 days of unemployment
in a year for 84 per cent of agricultural labours who have some
employment during the year.”

2) Causes of Rural Unemployment

In this connection, the Fourth 5-years Plan observed: “In many parts of the
country, there is heavy pressure of population on land. The agricultural
economy is unable to provide continuous work enough the year. The slack
agricultural season frequently extends from 3 to 6 months. The growth of
population, the pace at which non-agricultural activities are developing within
and outside the rural economy and greater resort by owners of land to
personal cultivation have tended to increase the strains of poverty for
cultivators with marginal holdings and large numbers of landless agricultural
workers. Even favourably situated areas show a considerable surplus of
manpower. The problem presented by chronic underemployment on the part
of large numbers of landless agricultural workers is of a long term character.
Very low wage levels and low levels of productivity are but symptoms of this

“From this observation we may conclude that, unemployment and

underemployment in rural areas has been due to:
(i) The rapid growth in population.

(ii) The non-availability of subsidiary occupation in the rural areas.

(iii) The inadequate development of non-agricultural sector from the point of

view of employment.

(iv) Small holdings which keep the cultivators and landless labourers busy
only for a part time. This is accentuated by the unevenness in distribution of

(v) the decay of the cottage industries.

(vi) unremunerated nature of the agricultural economy, due to rural

indebtedness, typical pattern of village life, illiteracy etc.
(vii) Seasonal nature of agricultural operations causing idleness among the

(viii) Scarcity of capital characterised by poor overheads and equipment’s and

inadequacy of working capital.

(ix) Unwillingness of the villagers to move out and leave the pastoral
surrounding to take up employment elsewhere.

(x) Existence of the joint family system which is an. unofficial agency for
providing relief to the unemployed.

(xi) Prevalence of self-employment on a large scale.

(xii) Lack of occupational mobility due to social institutions, particularly the

caste system.

(xiii) Rudimentary want structure, limited horizons and lack of aspirations

which enables the farmer to be satisfied with a very low level of income.”

3)Remedial Measures For Creating Rural Unemployment

Agriculture even now is a depressed industry and as such full employment is
not possible in agriculture. The Planning Commission observes, “Taking a
broad view, an increase in agricultural production would lead to a reduction in
under-employment rather than to the creation of new jobs in the rural areas.
The increase in industrial production does not lead to a proportionate growth
of opportunities for employment because most of the new process used in
large-scale industries are based on high productivity techniques…In this
situation, it would take a good deal of title to create conditions of satisfactory
full employment.”
In the words of the Planning Commission, “the remedy would be a continuing
expansion of the national economies at a high rate to create adequate
employment opportunity in the urban areas and to provide conditions for a
continuing growth of agricultural production which would reduce under-
employment and offer greater opportunities of work for landless labourer and
similar occupational groups. Sustained programmes over a period of years for
the rapid development of agriculture and expansion of modern industries and
the diversification and strengthening of the rural economic structure will be
the only solution to the problem of unemployment.”

Surplus labour should be put to such capital formative activities which are
labour intensive and require “a minimum draft on equipment and
materials, and in cases of shore gestation periods and the
possibility of promoting wide extension of their activities over the
whole countries.” Such labour power may conveniently be utilised for the
extension of afforestation and in areas for canal, and road construction, land
reclamation, bunding, terracing, surface drainage, minor irrigation projects
“Means of transport should be properly developed especially in the remote
areas, forested regions, and mining areas so that surplus labour could find
relief in going over to these areas for livelihood. Emigration from thickly
populated parts to newly reclaimed, irrigated and colonized regions should be
undertaken with greater intensity.”

The I.L.O. Branch in India suggests that the policy of employment

in rural areas should cover the following points:
(i) It should be a major policy to provide work for all who seek it.

(ii) The Plans for providing employment should be of a kind that help
economic growth.

(iii) Employment policy should place special emphasis on broad-based

programmes for promotion of productive employment in the rural sector.”

It further pointed out that, “work has to be provided to:

(a) All those who are able bodied and want work all the year round;

(b) To those who are employed only during busy agricultural season and need
work during the slack season; and

(c) To those who are employed fully.”

The main line of action that should be considered is the utilisation of the idle
and leisure hours of the employed. Unemployed and under-employed masses
should be our aim.

Diversification of the rural economy through rural industrialisation with

special stress on improving the technology in the existing rural industries and
introducing new industries suited to the conditions of different regions, is,
therefore, one of the major economic and social requirements of India.

Rural Works Programme:

The Third Plan admitted this situation and making an important advance in
understanding the problem introduced a new employment programme known
as rural work programme. It listed two categories of schemes involving
considerable use of unskilled and semi-skilled labour.

These were:
(i) Local works at the block and village levels, and

(ii) Larger works requiring technical supervision and planning by


The total outlay envisaged over the Plan period was Rs 150 crores. If we look
into the actual implementation of the rural works programmes, we can
understand that the magnitude of works undertaken and the actual amount
spent were far below than planned.

The emphasis under the programme was on the construction of civil works of
a permanent nature as would contribute to the mitigation if not the total
eradication, of the scarcity conditions in the areas concerned. It was expected
that the expenditure of every one crore of rupees under the programme would
result in the creation of employment for about 25,000 to 30,000 persons in
the working season,

Marginal Farmers and Agricultural Labourers:

This was a scheme included in the Fourth 5-year Plan with an outlay of Rs.
47.50 crores. Under the scheme 41 projects were proposed to be set up in
selected districts. Each of these projects was expected to cover about 20,000
families during the Fourth Plan consisting of marginal farmers and farm

These families were to be assisted with subsidized credit support for

agricultural and subsidiary occupations like diary, poultry, fishery, piggery-
rearing, horticultural operations, etc. This scheme was expected to benefit
about 8 to 9 lakh families of marginal farmer and farm labourers,

Integrated Dry Land Agricultural Development:

This was a centrally sponsored scheme taken up with a sum of Rs. 20 crores
during this Plan. Under the scheme, 24 projects, which were in the nature of
training-cum- demonstration programmes, were to be established around the
I.C.A.R. research centres in 12 States.

Each project was to cover an area of about 8,000 acres in a phased manner. In
these projects permanent works like soil conservation, land development and
water harvesting were undertaken. These programmes were labour intensive
and it was estimated that for an expenditure of every one crore of rupees on
these works, about 15,000 persons will get employment.

Agro-Service Centres:
The scheme provided for assistance to the unemployed graduates and diploma
holders in mechanical, agricultural and electrical engineering and allied fields
and to graduates for agriculture and science with experience in agriculture. It
aimed to help in establishing workshops, organizing agriculture machinery,
repairing and hiring facilities and other technical services like supply of spare
parts, inputs, etc.

The objectives of the scheme were:

(a) To provide self-employment opportunities to technical personnel;

(b) To provide on the farm maintenance and repairing facilities for

agricultural machinery and implements;

(c) An easily accessible source of supply for spite puns, fuel, oil and lubricants
and other engineering services; and
(d) Supply of inputs such as fertilizers, pesticides, etc. It was expected that
5,000 centres would be set up.

Area Development Schemes:

These schemes relate to the development of adequate infrastructure facilities
like roads, market complexes, etc., in area commanded by 10 major irrigation

Employment Guarantee Scheme:

The Bhagwati Committee on Unemployment, which submitted its report on
May 15, 1973, recommended Rural Employment Guarantee Scheme, which
was being then implemented in Maharashtra.

Under the scheme, the guarantee of work is restricted to unskilled manual

work only; the guarantee extends only to able-bodied adults (men and women
over 18 years); the participants have no choice of work but have to accept such
work as is offered to them; they have no choice of the area of work.

This scheme is not applicable to municipal areas. But the Employment

Guarantee Scheme is not to be looked upon as a substitute for other
employment-oriented programmes under the Five-Year Plans. The Committee
has suggested crash programmes for creating employment opportunities
mainly in rural areas.

Article 41 of the constitution has laid down the right to work, it is a directive
principle of the state policy. But this right to work has to be implemented by
the state within the limits of its economic capacity and development.

The right to work for employment for the mass of population has been a
distant goal to be secured and attained by the state. While formulating the new
policy regarding guaranteed employment,’ the experiences of Maharashtra
and Karnataka should be taken into consideration.

The migration of population from rural to urban areas in search of

employment is a regular feature in India, with the result that cities tend to
grow at the expense of the country. Rural people have not only been migrating
to nearby cities and metropolitan towns but sometimes they have been
migrating to places several thousand kilometres away from their original

They have migrated not only within the country from one region to another,
but also to foreign countries such as Fiji, Malaysia, Mauritius, New Guinea,
many African countries and to several other parts of the world. Lack of
employment opportunities in rural India have forced the people to drift in
search of job far and wide.

Crash Programme for Rural Employment:

The primary objective of the scheme was to generate additional employment
through a network of rural projects of various kinds which are labour-
intensive and productive. The scheme had two fold purpose, (i) A project in
each block should provide employment to 100 persons on an average
continuously over a working season of 10 months in a year, (ii) Each project
should produce works or assets of durable nature in consonance with the local
development plans.

The various types of projects include schemes relating to minor irrigation,

land reclamation, soil conservation, and afforestation, flood protection and
anti-water logging measures, drinking water pisciculture, and construction of
roads. The crash programme introduced in April 1971 involved an outlay of Rs.
150 crores in the three-year period 1971-74 to create employment for over 4
lakh persons.

We have described above the various steps taken by the Govt., to tackle rural
unemployment and underemployment, but there is a high possibility that
some of the measures may not meet with success. The main factor is the
creation of an infrastructure to handle the crash programme and push it

Minimum Needs Programme:

In view of the recent trust of new employment-generating activities such as
MNP (Minimum Needs Programme), the CSRE was virtually dropped and a
Pilot Intensive Rural Employment Project (PIREP) was evolved and taken up
for working from 1972-73 to 1974-75 in 15 blocks throughout the country.
The object of this project is to collect the necessary data in order to ascertain
the dimensions of the programme for providing full employment to everyone
who is willing to work. This scheme was to be implemented over a three- year
period and will accordingly spill over to the first year of the fifth five year Plan.

PIREP is a research-cum-action plan. It was found that the number of workers

estimated by the employment survey, registered and turning up for work
differed. It has been decided that each state govt, must take account the
situation existing in the particular block and plan accordingly implementation
of the works with due regard to the availability of farmers.

Fundamental Deficiencies:
In an underdeveloped country, failure to provide full employment can be
traced to certain fundamental deficiencies in the economic structure.

Until the economic base has been greatly strengthened and education and
other social services developed, the economy will not be able to achieve a rate
of growth sufficient to provide work at an adequate level of remuneration to
the entire rural population. These processes necessarily take time and call for
a scale of effort and investment which may be well beyond the capacity of the
economy in the early stages.

However, the reasons often given for not being able to solve the
employment problem in rural India are:
(i) Pressure of population on land and rapid growth of population.

(ii) Lack of education and traditional, fatalistic orthodox outlook of the rural

(iii) It is futile to try to solve the problem of rural employment, in an

overpopulated land, by redistribution of land which is in short supply.

(iv) The redistribution of the surplus land among the landless and weaker
section of the rural community has not provided them full employment. This
has happened so because almost everywhere such land was of inferior quality
and the person to whom the land was allotted suffered from many handicaps.
In fuel in a majority of these cases the distribution of surplus land in small
pieces to the landless does no good either to the landless or to the land.

(v) The number of landless labourers has been growing gradually and it will
continue to grow till non-agricultural occupations absorb them in villages. All
of them cannot be settled on land, because growth of employment
opportunities within agriculture has not been significant. There is absence of
adequate subsidiary occupations.

(vi) Progressive mechanisation and substitution of power for human labour

has further aggravated the problem.

(vii) Village industries and artisans were the first to suffer, unable to compete
with the new industrial products in their quality, variety and above all in costs,
the people engaged in the traditional industries were thrown out of
employment. Thus, they have swelled the ranks of either the small cultivators
or the landless labourers. Those who clung to their traditional occupations
have remained progressively underemployed.

(viii) Employment is most difficult in areas which have heavy pressure of

population or in which on account of the scanty development of local
resources, low levels of productivity persist and there is lack of continuous

(ix) Job opportunities for the unskilled have been insignificant.

Some Questions about Future Planning:

The important issues could be summarised as follows:
(1) If the existing pattern of planning to provide more employment
opportunities is dis-functional, what should be the pattern of future planning?

(2) If the major effort is to be directed to the uplift of the rural poor and
vulnerable sections of the community, what should be the main ingredients of
our employment social policy?

(3) If the existing financial resources available for creating more jobs are not
sufficient, how should they be utilised to yield optimum results?
(4) A faster rate of growth is pre-condition for rural employment. In view of
this, how to restrict the migration of rural youths from villages to urban areas
and how best to utilise the services of university educated youths hailing from
rural areas for setting, working and developing the villages so that faster
growth may be possible in rural India ?

(5) How far a more developed technology, scientific innovations and

agronomic-research can help us in solving the problem of rural employment?

(6) How far creation of income opportunities outside agriculture and shifting
of population from agricultural sector to non-agricultural sectors could help us
in solving the vital issue of employment?

(7) How far the pooling together of schemes at the village level would turn the
under and unemployed persons into producers by the optimum utilisation of
human resources?

(8) What type of employment opportunities could be created to provide

employment to educated persons particularly in view of the fact that the
graduates of our universities fail to find employment which they expect?

The Now Strategy Suggested:

Provision of more employment should from the major component of our
developmental programmes, projects, plans, services and new social
legislation. The strategy suggested below is massive employment generation.

For this due emphasis needs to be laid on augmenting the production of food
and other articles of mass consumption. Decentralisation of industries and
expansion and development of village, small-scale and cottage industries
could be of some help in this direction.

Regarding industries three increasingly important propositions

(a) Protecting the existing employment in the traditional industry from
aggression of modern industry,
(b) Containing the modern industry to its present level and reserving all future
expansion of production for traditional industry, and

(c) Undertaking an active expansion of the traditional industry with a view to

covering some of the employment lost to modern industry and thus to expand
employment even at the present level of production.

The use of power and cheap, light and handy machines which do not replace
labour could help to some extent in providing more employment opportunities
in rural areas. Population control and family planning needs to be given due
attention but without any coercion of rural manpower planning.

A new social legislation needs to be introduced which may guarantee the right
of gainful employment to every rural India. This has also been a
advocated by Dandekar and Rath as one of the means to solve rural poverty.
Prior to introducing new social legislation, the scheme of employment
introduced by Maharashtra deserves to be considered seriously. The creation
of employment opportunities cannot be approached merely in overall terms.
The problem needs to be broken up in terms of sectors, regions and classes.

“Diversifications of the industrial pattern, a suitable policy on location of

industries, special measures to assist small scale and cottage industries,
maintenance of economic activity continuously at high levels, provision of
adequate training facilities, measures to promote geographical and
occupational mobility of labour, all these must be considered as elements in
the programme of creating new employment in the requisite scale.”

4)Steps to Solve the Problem of Rural Unemployment

The problem of unemployment in India is alarming. It has adversely affected

the social life of many individuals. Thus, keeping in view the different aspects
of the problem, some steps are suggested which will be helpful to solve the
problem of rural unemployment and other types of urban unemployment.

These steps are:

(i) Reconstruction of Agriculture:
Indian agriculture is a mode of living rather than a profitable occupation. It is
a tale of woe to tell. Therefore, it needs overhauling and reconstruction
making an economic pursuit.

Methods of cultivation should undergo a radical change according to the

conditions of local needs. Irrigations facilities should be unproved so that
agriculture should not be at the mercy of monsoons. Institutional framework
and agrarian relations should vigorously be adopted to provide social justice
and economic equality.

(ii) Adoption of Labour Intensive Techniques:

Despite, the fact that the strategy of Prof. Mahalanobis for basic and key
industries which is based on capital intensive techniques our government
should try to adopt labour intensive techniques for new fields of production.

(iii) Rapid Industrialisation:

To solve the problem of industrial unemployment, remedy lies in stepping op
industrial efficiency. It means that the expansion of existing and the
development of new industries are urgently required.

Some basic industries like iron and steel industries, defence, chemical, power
generation, and atomic etc. should be set up. At the same time to improve the
defective and uneconomic centralisation, it is pre-requisite to introduce
rationalization on scientific grounds.

(iv) Population Control:

There is no second opinion to say that population in India is ruing at a very
high speed. Unless this problem is not checked, the problem of unemployment
cannot be solved properly. Efforts should be made to raise the agricultural and
industrial production. Therefore, special drive should be made to make the
programme of family planning a good success specially in rural and backward
regions of the country.

(v) Re-Orientation of Education System:

As regards the problem of educated unemployment in urban areas, India
should reconstruct the education system and overhaul according to changing
environment of the country. There must be vocationalisation of education.
Proper education should be imparted to the younger men who will be in a
position to start certain cottage and small scale industries of their own choice
specially at village level.

(vi) Extension of Social Services:

India is still lagging behind in the sphere of education, medical science and
other services as compared to the advanced countries of the West. Therefore,
efforts should be made to extend these services to rural folks and in the
backward regions of the country. It will go a long way to impart awakening
among the common masses.

(vii) Decentralisation:
Experience shows that lack of gainful opportunities of employment in villages
and small towns has led to the migration of people to metropolitan cities in
search of alternative jobs. This has created the problem of over crowdedness
and urbanization. Under these circumstances, it is advisable to encourage
industries around small towns preferably according to the local endowments.

(viii) Encouragement of Small Enterprises:

To provide the opportunities for self-employment, small scale industries
should be given top priority. They should be provided liberal loans, training,
facilities of raw material and infrastructures and market facilities etc. It is a
good luck that the Sixth Five Year Plan (1980-85) has given due consideration
to dispel these facilities under the scheme of self-employment. Similar steps
have been proposed in the Eighth Five Year Plan.

(ix) Guiding Centres and More Employment Exchanges:

The economists are of unanimous view that more employment exchanges
should be opened in rural as well as in urban areas to give guidance to the
people to search employment. They should also be motivated for self-
employment proposals.

(x) Rural Development Schemes:

As rural sector is dominated and agriculture is the basic occupation of the
people, therefore, urgent need of the hour is to introduce rural development
schemes. It is correctly believed that there is no other remedy than a massive
programme of investment in rural development and massive injection of
science and technology into the methods of production followed in rural areas
in their agricultural and non-agricultural activities.

5)Government Policy Measures to Remove Unemployment

(i) National Rural Employment Programme:

The National Rural Employment programme was started as a part of the sixth
plan and remained continued under the seventh five year plan. It envisages to
create employment opportunities of the order of 300-400 million man-days
every year. It aims to provide employment in the lean agricultural season.
During the seventh plan, the outlay for this programme is targeted at Rs. 3092
crores and it created 1477 million man-day.

(ii) Rural Landless Employment Guarantee Programme:

RLEGP was started in 1983. The bask objective of the programme
(a) To improve and expand employment opportunities for rural landless

(b) To strengthen the rural infra-structure.

During the seventh five year plan about 1154 million man-days of employment
were created under this programme.

(iii) Integrated Rural Development Programme:

Integrated Rural Development Programme aims at to raise the poor people
above the poverty line. It was expected to cover 18 million families in the
blocks of the country during the seventh plan. On an average about 3,000
families in a block were provided assistance through this programme.

(iv) Food for Work Programme:

This programme was Started in 1977. Its objectives were to generate
employment, improvement in income, creation of durable community assets,
strengthening of rural infra-structure. This scheme was directly beneficial to
the poor people. According to an estimate the scheme was to generate
additional employment of 40 crores man-days in a year.
(v) Training Rural Youth for Self-Employment:
TRYSEM war started in 1979 with the objective of removing unemployment
among the rural youth. It aimed at to provide training to about 2 lakh rural
youth every year, so that they may be self-employed.

Under this scheme 40 youths were selected from each block. In making
selection, members of SC/ST were, given preference. Under the scheme, a
minimum of 33–1/3% of rural youth trained were to be women. During the
seventh plan 10 lakh rural youth received training under TRYSEM.
(vi) Operation Flood II Dairy Development Projects:
This programme is expected to benefit 8 million milk producing families. The
other Dairy Development Schemes would benefit about 5 million additional

(vii) Employment Guarantee Scheme:

This scheme was started by the government of Maharashtra in 1972-73. It
provides gainful and productive employment to rural unskilled labour by
raising durable community assets like roads, canals etc. The scheme provides
right to work at a wage of Rs. 6 per day. Similar schemes have been started in
Tamil Nadu, Gujarat, Andhra Pradesh, Madhya Pradesh and Karnataka.

(viii) Jawahar Rojgar Yojana:

Jawahar Rojgar Yojna (JRY) was started in 1989-90. Its aim is to generate
additional employment by taking up productive works in rural areas. During
the Seventh Plan, it had generated 3497 million man-days of employment.

(ix) Nehru Rojgar Yojana:

Nehru Rojgar Yojna was started in October 1989. It consists of three sub
schemes viz., scheme of urban micro enterprises, scheme of urban wages
employment, scheme of housing and shelter up gradation. In 1991-92, 1.59
lakh families were assisted under SUME and 13 million man-day of
employment were generated under SUME and SHASU.

(x) Minimum Needs Programme:

The various components of the minimum needs programme are meant to
create substantial additional employment in infra-structure and social services
in rural areas.