What is underutilization?

Underutilization refers to a situation in which a resource, such as labor, capital, or land, is not being used to its full potential. This can result in reduced economic growth and productivity, as unused resources represent wasted potential that could be put to use in creating goods and services. In some cases, underutilization may be caused by factors such as inadequate infrastructure or government regulations that discourage investment and innovation. Other factors that can contribute to underutilization include skills mismatches, labor market inefficiencies, and inefficient production processes. Addressing these issues can help to reduce underutilization and promote economic growth and development.