Feature image for Disguised and Seasonal Unemployment blog

Difference Between Disguised and Seasonal Unemployment – CloveHRMS

Difference Between Disguised and Seasonal Unemployment

You may have only heard about employment and unemployment as two words that are the exact opposite of each other. However, in this world, many complex terms also exist, which makes you realize that there’s a lot more than we have thought. 

Two such terms are disguised unemployment and seasonal unemployment. While it may look like both of these terms are used for unemployment anyway, the same is not true.

What Is Disguised Unemployment?

Let’s first start with the disguised unemployment. As its name refers, disguised unemployment is when an employee disguises the employment and is only partially involved in the job. For example, suppose there is a need for three employees only in a factory, but the employer has employed two additional employees. In that case, these two employees will be said to be disguised as unemployed. 

This type of unemployment is mostly seen in the rural areas of developing nations. The reason why this type of unemployment occurs is mostly due to overpopulation. In simple words, when a person doesn’t have any other job to do, he/she has to work at places where the need of employees is already fulfilled, putting them in the category of disguised unemployed. Now, let’s look at the advantages and disadvantages of disguised unemployment. 

Advantages of Disguised Unemployment

  • The first benefit of disguised unemployment is that it ensures that the work at the organization is done every time without interruption due to someone’s absence. For example, if an employee has taken leave from work, there must be some backlog to expect due to his/her absence. However, when there are more employees than the actual requirement, the flow of work will never get interrupted. 
  • In developing nations, everyone has their struggles, which they go through daily. They have to earn money to spend on their necessities and wants. That’s why the social support system of such countries turns out to be weaker than developed countries. However, disguised employment helps ensure that no one is unemployed. In totality, it gives a sense of social security against the daily needs and wants. 
  • It also helps individuals get saved from open unemployment. To distinguish between open unemployment and disguised unemployment, it is when the person wants to work and also knows how to work but doesn’t get work in the market. 

These are the two benefits of disguised unemployment. However, these benefits are not a great solution to the core problem. For example, disguised unemployment is not a long-term solution if there’s a lack of employment opportunities in a village. But why? Let’s understand this by looking at its disadvantages. 

Disadvantages of Disguised Unemployment

  • As we discussed, it is not a permanent solution to the core problem because it leads to the wastage of resources. In simple terms, if more employees will do the work that just two employees can complete, it will not let the employer get a profitable deal. Hence, it will either lead to losses or an increase in the product or service outcome. 
  • From a broader perspective, it is also bad for the country’s economy. Disguised unemployment at scale can lead to lower GDP, which is bad for a developing nation. 
  • Another disadvantage is that there will be no competition between the employees. The reason is that if there is not enough work to do, then why will an employee try to outperform? Normally, an employee outperforms for incentives, which in case of disguised unemployment can’t be given because the workload is already less. 

What Is Seasonal Unemployment?

Seasonal unemployment is a much simpler and more common type of unemployment. In seasonal unemployment, one has to be unemployed because of the offseason of the job. For example, if there is a type of business whose sales go down in a certain season, it will lead to unemployment in that sector. 

Many industries, including tourism and agriculture, experience seasonal unemployment. For instance, if there’s a snow-themed park, it will have to shut its operation down in the winter season as a few to no people will visit the park in winter. 

So, the operational cost will be more than the income, leading to losses. Hence, those who used to work at that park will have to search for other sources of income due to seasonal unemployment. 

Another common thing in the businesses or industries where seasonal unemployment is evident is that these businesses have their peak season. So, even when the ice park has no visitors in winter, it may remain overcrowded in the summer. 

Similarly, the agriculture sector employs many people during the plantation work and harvest but remains inactive during the growth of the agricultural product. 

Advantages of Seasonal Unemployment

  • During peak seasons like summer or harvest time, tourism and agriculture thrive. It creates temporary but multiple job openings for people who may not have a job due to the season of any other business.
  • Seasonal employment helps meet the increased demand for goods and services. For example, rice harvesting can only be done in a fixed period. But its need remains for the whole year. So, harvesting as much as possible is important during peak season.
  • Many seasonal jobs don’t need to learn skills, so someone with no skills in the field can also be employed. 

Disadvantages of Seasonal Unemployment

  • Seasonal jobs may vanish as seasons change. It leaves workers without a steady income source, leading to financial uncertainty.
  • The unpredictability of seasonal work can cause financial stress during off-season periods. It’s one of the worst disadvantages of seasonal unemployment. 
  • Seasonal workers may rely on government assistance during periods of unemployment. Thus, it creates a cycle of job searching and dependence on external support systems.


To sum up, this is how these two terms differ from each other. While there are benefits to these two types of unemployment, they are not a permanent solution in any way. Ultimately, there is always a need for improvement to provide people with a stable source of income rather than pursuing careers where these two types of unemployment exist.

Related Post:-