Disguised Unemployment Published Oct 25, 2023 Definition of Disguised Unemployment Disguised unemployment refers to a situation where individuals appear to be employed, but their contribution to the productive output of an economy is minimal or nonexistent. Disguised unemployment definition can be stated as a type of unemployment where too many individual workers are filled with few job requirements. Disguised unemployment cab leads to low productivity. Disguised unemployment is a kind of unemployment in which there are people who are visibly employed but are actually unemployed. This situation is also known as 'hidden unemployment '. Disguised unemployment occurs when part of the labour force is either left without jobs or operates redundantly, such as the productivity of the workforce is effectively zero.