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Asked by Suresh Last Modified
Answer 
Charlie
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.
Another example is if you have one cow, you ideally need one person to milk it. If you hire 10 people to milk one cow, you just created disguised unemployment.
Disguised unemployment is a type of unemployment in which some people thinks they are employed but are actually not employed fully. This situation is also known as Hidden Unemployment. In such a situation more people are engaged in a work than required. For example in rural areas, this type of unemployment is generally found in agricultural sector,
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It's easy to understand this term in a way that unemployment is disguising by showing that all the people are working.
Let's say there is a farm and total production from this farm is 100 kg of cereals per year. This farm belongs to a family of 5 people. All of them work over this farm round the year, i.e. no one is employed in any other field - may be due to lack of job or lack of education.
Now suppose due to some govt scheme, there is the availability of a job in their area, which suits their skill and 2 of them started working there. So now only three persons left in the family to work on the farm. But the following year, the farm still producing 100kg of cereals.
Now we can see, in both cases, all the five persons are working/employed, but in the latter case, the family income is increased. That means these two extra persons were not required on-farm as after removing them, farm productivity does not get affected. That means they were working on the farm just because no other job was available.
That is what a hidden or disguised unemployment means.
->disguised unemployment is a situation where people are working, but all of them are made to work less than their potential or capacity
->it is hidden
->if a few people move out, it will not affect the production
->for example 10 people doing work that can be done by one person along
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