| Unemployment | Underemployment |
| (i) It refers to a situation in which people are willing to work at the prevailing wage rate but do not get jobs. | (i) It is a situation in which employed people are contributing to production, less than their capacity. |
| (ii) It is a situation when the supply of labour force is more than its demand. | (ii) It is a situation where workers work below his ability as he is unable to find a suitable job. |
| (iii) Unemployed are those who do not have any work. | (iii) Underemployed work for less than 28 hours a week or CA working as a clerk. |
| (iv) In this situation, there is wastage of working capacity and a complete waste of manpower. | (iv) In this situation there is underutilization of working capacity. |
