Editorial Simplified: Jobless Growth Becomes more Systemic | GS – III


Relevance :  GS Paper  III


Theme of the Article

Earlier confined largely to the organised sector, it has now spread to other areas, as revealed by the latest survey results.


Why has this issue cropped up?

The findings of the latest employment survey, called the Periodic Labour Force Survey (2017-18), are a cause for concern as the scenario is still far from anything that would denote decent employment. The two biggest issues here are: the shrinking share of the labour force; and the rising unemployment.


The data of concern

  • The labour force participation rate (% of people working or seeking work in the above-15 years age category) in the earlier survey of 2012 was 55.5%. This has shrunk to 49.7% in 2018.
  • There is an absolute decline in the number of workers from 467.7 million in 2012 to 461.5 million in 2018.
  • The figure for the overall unemployment rate at 6.1% is 2.77 times the same figure for 2012.
  • The highest unemployment rate of a severe nature was among the urban women at 10.8%; followed by urban men at 7.1%; rural men at 5.8%; and rural women at 3.8%.
  • Youth unemployment rate (unemployment among those in the 15-29 years age category) has reached a high 17.8%. Even here, the women stand more disadvantaged than the men, especially urban women, whose unemployment rate of 27.2% is more than double the 2012 figure of 13.1%.

Women labour

  • Given the sharp decline in women’s labour force participation rate, they have been losing out heavily due to the double whammy of exclusion from the labour force and an inability to access employment when included in the labour force.
  • The decline in women’s labour force participation from 31% to 24% means that India is among the countries with the lowest participation of women in the labour force.

Educated employment

  • The issue of educated unemployment, given its link with not just growth but also with transformative development, has never been as acute as at present.
  • What is significant is that the unemployment rates go up as levels of education go up. Among those with secondary school education, it is 5.7% but jumps to 10.3% when those with higher secondary-level education are considered. The highest rate is among the diploma and certificate holders (19.8%); followed by graduates (17.2); and postgraduates (14.6%).
  • Of course, educated persons are likely to have aspirations for specific jobs and hence likely to go through a longer waiting period than their less-educated counterparts. They are also likely to be less economically deprived. But the country’s inability to absorb the educated into gainful employment is indeed an economic loss and a demoralising experience both for the unemployed and those enthusiastically enrolling themselves for higher education.
  • Here again, the burden is the highest among urban women (19.8%) followed by rural women (17.3%), rural men (10.5%) and urban men (9.2%). Among the educated, women face a more unfavourable situation than men despite a low labour force participation rate.

Conclusion

The overall conclusion here is that the trend of ‘jobless growth’ that was till recently confined largely, if not only, to the organised sector has now spread to other sectors of the economy, making it more generalised. This calls for a thorough re-examination of the missing linkages between growth and employment.


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