‘Mapping the ‘unemployment’ in India’

Recent data on the contraction of the economy raises concern on the employment situation in India. This sharp contraction has to be seen in the light of India having witnessed a wave of massive ‘reverse migration’ during the early phase of the lockdown, with millions of workers returning to their home States due to a loss of livelihoods.

• In the current pandemic situation, the world has been caught ill-prepared to deal with a crisis of high magnitude.
• Government’s periodic labour force survey carried out in 2017-18 revealed that unemployment in the country reached an all-time high rate of 6.1%.
• At the heart of unemployment problem in India is the young, unemployed men aged from 15-29 which comprise 68% of all unemployed youths in the country.
• Adding to this are the ill-effects of the pandemic that have been essentially skewed against the youth (15-29 years) as they face a trilemma of unemployment, disruption in education, and struggling education system.

• Firstly size of labour supply in India is getting a boost from the rapid expansion of the working age population.
• Secondly the nature of labour supply is changing too, with increasing enrolment of young adults for education and their rising job aspirations.
• Thirdly size of workforce engaged in agriculture has been declining in India from 258 million in 2005 to 197 million in 2018.
• Agriculture: The decline has been partly due to stagnant public investment from 1990s and also driven by the pull of new opportunities in towns and cities.
• Manufacturing sector: Size of manufacturing workforce in India declined by one million from 2012-2018. Micro and small firms received severe setbacks. While sectors like education, professional businesses, allied services recorded acceleration in employment growth.
• Poor skilling of youth: According to Periodic Labour force survey 2018 the pervasive joblessness was due to poor training of youth as only 7% of the people surveyed declared any formal or informal training.
• Centre for monitoring Indian economy: It says that more educated Indians are the more likely they are to remain unemployed too.
• Not in Labour Force, Education and Training” (NLET) in India which estimates the number of people who are neither working nor looking for work nor undergoing education or training, accounted for 100.2 million young people in India. This steep figure was despite various government interventions for increasing skilling, entrepreneurship and job creation in the country.

• First, given the scale of urbanization, the focus on urban employment generation programmes should be in coordination with local governments; this is key to ‘solving other problems faced by cities
• Lack of desired skill set makes it difficult for employers to fill job positions. Employer’s collaboration with the educated bodies will ensure a skilled labour pool in coming years.
• The sectors which created the highest number of jobs for the past decade i.e. manufacturing, construction, trade, hotel and transport are most badly hit due to the pandemic.Large public investment and targeted effort especially towards the younger section of population is required to revive these sector
• Additionally, special efforts need to be made to ensure minimal disruption in continued education and to bridge the digital divide.
• MGNREGA and rural jobs schemes have to be strengthened and their capacity increased, but only a portion of the workforce might be accommodated in it.
• There will still be a large number of workers who need to be provided with alternative sources of employment, and generating decent urban jobs looks to be the way out.

Given the situation, urgent action is needed in multiple fronts including investment in human capital, revival of productive sectors and programmes to stimulate small entrepreneurship.