Jobless growth

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Bikky Khosla | 16 May, 2017
Jobless growth has, for quite some time now, been pointed out as a major challenge facing India. Our economy is powering ahead, but without creating enough jobs, and this widening gap clearly indicates that our policy makers' focus only on increasing the GDP growth rate is not enough. They have a tougher task ahead: to create gainful employment opportunities for our unemployed youths. More than 12 million people join the Indian job market annually, but in contrast, employment generation has remained pathetically poor and this situation must change if we want to make sure that the benefits of growth reach the masses.

Following PM Modi's recent directions, the Centre has last week set up a high-level task force to recommend how to collect reliable and timely data on employment. Better late than never. It is a no-brainer so say that our employment data collection system needs a radical overhaul. Currently, the quarterly employment survey by the labour bureau covers just eight sectors of the economy while the National Sample Survey Organisation releases employment data only once in five years. Most of the times data released by different official sources is outdated or incomplete. This needs to change. Reliable data is a must for effective policy making, and so, first of all, we need to reform the jobs data ecosystem.

Critics view that our economic growth during the recent boom years was largely driven by less labour-intensive sectors. The Economic Survey 2016-17 also stressed the need to focus on labour-intensive sectors, and on the same line the Centre later came out with an apparel package and declared that such benefits may be extended to other labour-intensive sectors such as leather, but unfortunately not much positive has come out yet. In fact, the apparel plan has failed to attract many due to bureaucratic and other hurdles while the leather sector is facing the heat of the anti-abattoir movement. Similarly, some labour-intensive sectors like mobile manufacturing are facing uncertainty as the Centre has yet to come out with a post GST plan for them. This situation is not encouraging.

No doubt that the Government's push to ease of doing business and investment in infrastructure, housing and tourism will help employment generation. Also, large multinationals with their impressive investment commitments can contribute to the cause. But these efforts alone are not sufficient. The main focus should be on SMEs spreading in every nook and cranny of the country. They are in a better position to create jobs. Also, our skill ecosystem needs a complete overhaul. We need to help our students to transform into workers, for which the curriculum has to be fine-tuned so that our education system can lead to employability.

I invite your opinions.