New Delhi: Researchers from Indian Institute of Management, IIM Lucknow, in collaboration with Birla Institute of Technology and Science (BITS) Pilani and the Union Ministry for Agriculture and Farmers Welfare, have found “a stagnating employment growth rate, weakening employment elasticity, slow structural transformation” as per The Hindu, which has reported on their findings published in the Indian Journal of Labour Economics.
“Jobless growth”
The researchers have used data from the National Sample Survey Office (NSSO) Employment and Unemployment Survey and the Periodic Labour Force Survey. The have concluded that there was a surge in output growth and employment between 1987–88 and 2004–05, followed by ‘jobless growth’ from 2004–05 to 2018–19 and a very small “rebound” thereafter.
“Apparently, economic growth, rather than creating more jobs, has resulted in net labour displacement. Alongside the number of jobs created, it is equally important to examine the quality and decency of jobs,” Professor S. Tripati Rao of IIM, Lucknow is quoted as saying. In 2020–21, the total labour force in India was at 556.1 million. Of this a majority or 54.9% were self-employed, just 22.8% in regular employment and an 22.3% in casual employment.
The Wire had reported on May 2, 2023 on the crisis in jobs as well as the quality of jobs. Mahesh Vyas of CMIE had told The Wire that the quality of jobs in India is very low. “Most jobs pay poorly and are of informal arrangements in the unorganised sectors.”
India’s job data has been patchy and not revealed regularly of late. There are also serious questions about what it captures and is it reflects employment precarity at all. OECD uses three “objective and measurable dimensions” to help quantify the quality of jobs, which Indian data still does not do. The three criteria are, earnings quality, which “captures the extent to which earnings contribute to workers’ well-being in terms of average earnings and their distribution across the workforce.” The labour market security and the quality of the working environment are the other two criteria.
Gender disparity worsens?
The IIM/BITS/Ministry of Agriculture study has also found gender-based disparity in the Labour Force Participation Rate (LFPR) in rural and urban areas continues and worryingly, the decline of LFPR is higher for females than for males from 1983 to 2020–21. “The overall female Work Force Participation Rate (WFPR) for those aged 15–59 in 2020–21 stood at 32.46%, a full 44.55 percentage points below that of men. Further, the total percentage of male WFPR (81.10%) in the same year for aged 15–59 years is more than twice the rate for female adults (33.79%),” the study says.
Unemployment much higher for highly educated Indians
The Government of India has been helping mediate between foreign governments like in Taiwan and more controversially in Israel, for providing semi-skilled and unskilled labour to those countries, signalling its inability to provide jobs in basic manufacturing industries in the country. An MoU with Taiwan in this respect was signed on February 16, 2024. The jobs crisis in India, as per the BBC’s report last month, has been “driving workers to Israel,” and even before the war on Gaza, Israel, and India had “signed an agreement in May 2023 that would send 42,000 Indian construction and nursing workers to Israel,” according to comments by former Israeli foreign minister Eli Cohen in the Israeli Knesset, as per Mint.
But prospects for employment do not improve with rising education levels and progressively get worse, also as per this study, suggesting a comprehensive failure to generate jobs across the board in India.
The unemployment rate in India rises with education levels. The unemployment rate “for the illiterate and less educated class (below primary) was 0.57% and 1.13% respectively while, for the highly educated class (graduates and above), it was 14.73% in 2020–21 for the age group 15–29 years.” This pattern can be seen across the years, as per the analysis.
The study recommends more attention to MNREGA, other poverty alleviation programmes and public works. It finds MNREGA to positively help with “raising wages in rural areas by 5%, increase in Labour Force Participation among female workers, improvement in low-caste working bargaining power, increasing rural wage levels, and fall in reliance on high-caste employers.”