The failed promise of employment -CP Chandrasekhar

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published Published on Jan 21, 2019   modified Modified on Jan 21, 2019

As election 2019 approaches, the Modi government, damaged by agrarian distress, is also being challenged by evidence that its record on employment generation has been extremely poor. To recall, in its campaign during the 2014 election which brought it back to power, the BJP-led National Democratic Alliance (NDA) promised to create 10 million jobs every year.

The best source of information on employment we currently have is the privately conducted (and heavily priced) Consumer Pyramids Household Survey undertaken by the Centre for Monitoring the Indian Economy (CMIE). These figures are available from 2016 from a sample of more than 170,000 surveyed in more or less equal sub-sets over four months starting January-April. They show that the number of employed, estimated on the basis of the status of the sample interviewees on the day of coverage, rose from an average of 401 million during January-April 2016, to 403 million during May-August 2016, 406.5 million during September to December 2016, before falling to 405 million in January-April 2017, arguably as a result of the effects of demonetisation. This essentially means that employment rose by 5.5 million between the first and last quarters of 2016, and that demonetisation brought down that figure to an annual 4 million.  Even while claiming to have moved into the league of the fastest growing economies, Modi’s government seems to have been well short of target on employment.

Further, more recent figures from CMIE available in the public domain suggest that things are getting worse. The estimated number employed fell from 406 million in April-June 2017 (or the first quarter of 2017-18) to 402 million in the first quarter of 2018-19, suggesting that the decline that began after demonetisation is persisting. The estimate based on the monthly sample for December 2018 put the figure of number employed at an even lower 397 million.

The phenomenon of “jobless growth” is not India specific. But it perhaps matters more in this country, given its young population. According to the 2011 Census, 422 million out of India’s 1.25 billion people were in the age group 15-29. Moreover, around 13 million young people enter the job market every year. This demographic trend seems to be gaining momentum. Between 2011 to 2015, while participants in the labour force belonging to the 15-29 year age group grew by 40 million, the number of those older than 29 fell by 30 million. The comprehensive report on the State of Working India from the Centre for Sustainable Employment of Azim Premji University reports that “the unemployed are also disproportionately young. More than 60 per cent of them are in the 15-25 year age group,” though this group constitutes only 30 per cent of the total working age population. The definition of employment used here is the principal status criterion, which treats who are looking for work and do not have at least six months of employment in a year as unemployed. The educated too seem to be disproportionately unemployed. Of the 23 million who were employed for less than six months in the year despite actively searching for jobs, one third had graduate or higher levels of education.

Please click here to read more., 17 January, 2019,

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