Causes of Unemployment: India faces extensive unemployment due to following causes:

1. High rate of population growth: Because of high growth rate of population labour supply increases rapidly but there is a slow rise in employment opportunity which increases the problem of unemployment and underemployment.

2. Slow rise in employment opportunities: During planning period there was continuous increase in economic growth but failed in creating employment opportunities which increased unemployment.

3. Low rate of savings and investments: During planning period national income has increased but due to high population growth per capita income increased at a lower rate that could not satisfy the basic needs of population. As a result savings and investments remain low. Because of low rate; investment in agriculture, industries, etc. much employments cannot be created and the problem of unemployment has been increased.

4. Capital intensive production technique: In planning schemes India has adopted intensive technique and labour intensive technique was given less importance. In agriculture and industries mechanisation was adopted which increased employment at slow rate. As a result unemployment problem has become acute.

5. Lack of vocational education: Present education system is lacking vocational education. Hence skilled labourers are few. Hence more unemployment is seen,

6. Lack of manpower planning: In India during planning period education has been made a widespread activity without estimation of kind and number of labour requirement. As a result educated youth remains unemployed.

7. Inefficiency of public sector: The quantity of employment generation estimated from public sector was not able to generate more employment because of its low productivity.

8. Negligence towards agriculture sector: In India’s economic development policy, more emphasis is given to other sectors than agriculture. So agriculture sector failed to generate more employment and unemployment increased.

9. Low mobility of workers: In India, due to social reasons, family relations, language, religion, casteism, culture and structural reasons mobilisation of workers is restrained. Also due to attraction towards urban life and urban facilities workers do not prefer to live in villages for employment. This causes increase in unemployment.

10. Lack of infrastructural facilities: In rural areas because of lack of infrastructural facilities, new industries are not established, as a result new employment cannot arise and unemployment exist.

11. Other causes: In India lack of national employment policy, lack of conducive environment for development of industries and trade, under-utilization of natural resources are also responsible causes for increase in unemployment.