Disguised unemployment?

Disguised unemployment is a kind of unemployment in which there are people who are visibly employed but are actually unemployed. This situation is also known as 'hidden unemployment'. In such a situation more people are engaged in a work than required. For example:
1. In rural areas, this type of unemployment is generally found in agricultural sector like - in a family of 9 people all are engaged in the same agricultural plot. But if 4 people are withdrawn from it there will be no reduction in output. So, these 4 people are actually facing disguised unemployment.
2. In urban areas, this type of unemployment can be seen mostly in service sectors such as in a family all members are engaged in one petty shop or a small business which can be managed by less number of persons.

The situation of underemployment is referred to the situation when people are apparently working but all of them are made to work less than their potential is called disguised unemployment. In this case, the person considers himself employed but is actually not working.

Example

(i) In rural areas, where agriculture is the main source of income, this kind of unemployment can be seen often. If a piece of land requires only three people to work on it and instead five people are working on it, then the two extra people are said to be in a situation of disguised unemployment.

(i) In cities and urban areas, disguised unemployment is seen when painters, plumbers, electricians are unable to find work on a daily basis and work way less than their potential.