Solving the mystery of missing employment data in the Indian economy -Himanshu

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published Published on Jul 31, 2018   modified Modified on Jul 31, 2018

The prime minister is partly right in the sense that the most authoritative data on employment-unemployment from the periodic NSSO were not available after 2011-12

In an interview given to Swarajya magazine earlier this month, Prime Minister Narendra Modi lamented the lack of data on jobs in the country. This was in response to a question on why the economy is not creating jobs. The prime minister is partly right in the sense that the most authoritative data on employment-unemployment from the periodic National Sample Survey Office (NSSO) were not available after 2011-12. But this does not mean that there is no data on jobs in the economy.

There are numerous sources, which provide estimates of employment for the whole economy, as well as some for only particular sectors or particular types of employment. Much of the debate on jobs has been based on these data sets ranging from the quarterly surveys of the labour bureau to the privately conducted surveys by the Centre for Monitoring Indian Economy (CMIE).

Apart from these, there are also several good proxies, which can be used to arrive at some idea of the employment scenario in the country, national accounts and wage data being two important sources. The other source that has been used extensively as a proxy for employment generation is the data on social security enrolment from Employees’ Provident Fund Organisation (EPFO).

The absence of authoritative and credible data has led to a situation of claims and counter-claims on employment creation under this government, depending on the choice of data. So far, the most authoritative data, similar in most respects to the NSSO surveys, are the labour bureau annual surveys. The last two surveys report that employment in the economy reduced by 16 million between March 2014 and July 2015. All other sources of data are sectoral and, at best, cover less than 10% to a maximum of 25% of the workforce. Attempts at using these to arrive at national estimates are unrealistic and unreliable. But even with these, the rate of employment creation is not only lower than the rate of employment creation during the United Progressive Alliance (UPA), but also nowhere close to the promised 20 million jobs per year. Even the CMIE data, which is the only private sector data source on employment, suggests a decline in rate of employment creation since demonetization and certainly much lower than what is required.

Among the indirect data sources, perhaps the most conclusive evidence is from the wage data, which shows a decline in real wages since May 2014 when the government took over. Clearly, the evidence on jobs may be less than robust compared to NSSO surveys, but it does show that there is no evidence of job creation having accelerated under this government. And certainly, nowhere close to what is required for the economy and what was promised by the prime minister during his election campaign in 2014.

Please click here to read more., 30 July, 2018,

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