The recent findings by the Labour Bureau's Employment and Unemployment Survey (2009-10) provide timely pointers to the manner in which liberalising India's workforce is coping with the changing times. The survey gives a snapshot of the country's employment and demographic situation. The estimated unemployment rate — in the region of 9.4 per cent (barring the five north-eastern States and the islands of Lakshadweep and Andaman and Nicobar, where the survey was not done) — is a reminder that creating jobs for the millions will continue to be a fundamental challenge for policymakers. Although the global economic downturn offers itself as a ready explanation, the malaise runs deeper: the inability to come up with an effective rural employment strategy. Despite industrialisation, rural India remains the main employment provider. That the situation has not changed drastically in the two decades of reforms is evident from the survey results. First, it brings out the magnitude of unemployment; secondly, it turns the spotlight on the low availability of social security benefits for the Indian workforce.
Disaggregated data make it evident that rural India should remain the focus of policymakers. It is home to 72.26 per cent of the country's 238 million households, and 10.1 per cent of its labour force is unemployed, compared with 7.3 per cent in urban areas. The double-digit rural unemployment rate points to both an excess of labour that needs to be moved from agriculture and allied activities to manufacturing and services, and the declining role of the primary sector as an employment provider. In rural areas, agriculture continues to be the dominant employer (57 per cent), followed by construction (7.2 per cent), manufacturing (6.7 per cent), and community services (6.3 per cent). Although there is a case for strengthening well-conceived schemes guaranteeing minimum employment, they could at best be bridge solutions. Upgrading the skills of the rural workforce to enable it to match the requirements of the manufacturing and services sectors would provide more lasting results. Equally important is the survey's observation that the spread of social security cover is woefully inadequate — only a paltry 163 persons per 1,000 benefit from the various social security measures. This low coverage should remind policymakers that a lot more needs to be done for a workable social security system to be in place. Despite the recent initiatives, the challenges on the employment generation and the social security fronts remain largely unaddressed.