Surplus labour
Topic: Employment, Unemployment and Informalisation · NCERT: Class 11, Ch 1 "Indian Economy on the Eve of Independence"
Meaning
Surplus labour means more workers in an activity than production actually needs. The extra workers add little or nothing to output. At independence, Indian agriculture was "saddled with surplus labour and extremely low productivity" (Class 11). Planners hoped that industrialisation would draw these workers into factories. Even after 70 years of planning, however, nearly half the workforce is still in the primary sector (46.1% in 2023-24).
Example
A family with a small plot of land has seven members working on it when three would be enough. The four extra members are surplus labour. If they took jobs elsewhere, farm output would not fall.
Don't confuse with
- Disguised unemployment: this is how surplus labour shows up for individual workers. Extra workers look busy, but their marginal product (extra output) is zero. Surplus labour is the wider idea of too many workers across a whole sector.