Economy Growing With Decreasing Jobs

by Shatakshi Gupta

#Modi_Rozgar_Do remained the top trend on Twitter for the past few days. There were over 25 lakh tweets on this trend. This was not the first time when such a hashtag was trending. These incidents point towards India’s ever-increasing unemployment problem.

 According to the Center for Monitoring Indian Economy (CMIE), in 2019-20, about 40.35 crore people in India had employment and about 3.5 crore people were unemployed in the country.  For context, in India every year there are 1 crore people who look for jobs.  The number of people engaged in employment in the country has not increased but has been gradually decreasing. If we combine these figures with the Indian economy, then it is understood that even though the economy is growing at a slow pace, jobs are not increasing at par.

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 These figures for unemployment have been collected by CMIE.  Accordingly, there is a steady decline in the number of people employed in India. In 2016-17, 40.73 crore people in India had employment. This figure decreased to 40.59 crores in 2017-18 and 2018-19 the figure further fall to 40.09 crores.

Corona worsened the picture

 This figure has become more alarming for the economy due to COVID-19 as millions of people have lost jobs in the last one year in India.

Apart from this, the figure of 4.5 crores is only for the openly unemployed people. Open unemployment means unemployment in which people want to work and they also have skills, yet they are not getting work. Apart from this, there are other types of unemployment in India. In such a situation, the problem of unemployment is much bigger than it appears.

Future is certainly not so hopeful
Source: ANI News

 According to an analysis by the National Skill Development Corporation (NSDC) in the year 2020, 60 million people will join the labour force of India in 2023.  Also, those that have already been skilled will need to be re-skilled. There is currently no special plan for such people. 

Falling expenditure on education and skill development

The expenditure on education has also been declining since 2014.At present, the government claims a placement of 54% of the people getting training on the Skill India Program website, but according to the final report (which is for the year 2019-20) available on the website of the Ministry of Skill Development, till December 31, 2019, 3,81,131 people received certificates under PMKVY, out of which only 1,09,729 people were placed. While the total number of people trained under PMKVY was almost five times more (5,21,614).

Transparency of employment data

One of the biggest problems is the lack of accurate data or underestimate data. The last major data on employment from the government was given by the Periodic Labour Force Survey, 2018-19.If we had accurate data, it would not only bring transparency but also help the government or policy-makers to create schemes accordingly.

Need to shift our focus

Seeing the gravity of the situation, the government must shift its focus from subsidy based employment to invest more in human capital. For example, MNREGA not only provides employment but is also an indicator of unemployment. It also shows unemployment of the unskilled workforce in the country. The need of the hour is to shift from subsidized schemes like MNREGA to focus on basic structural reforms. This can be done by increasing expenditure on education and skill. By doing this, people will be able to directly engage in jobs like a skilled workforce. The MNREGA costs so dear to the government. If such a huge investment is made on skill-development and education rather than subsidy, then the problem of employment can be solved more easily and forever.