Report warns of poor quality of labour force in 2020
Social security for unorganised sector urgedEmployment has grown faster in the unorganised sectorDelhi, Gujarat, Karnataka top rankers in overall labour ecosystem
CHENNAI: Extending protection of labour laws and social security to unorganised labour which accounts for 93 per cent of the country's 402-million-strong workforce and shifting labour from the Concurrent List to the State List of the Constitution to give States the freedom to reform labour laws to boost employment are among the suggestions made by "India Labour Report 2006'' prepared by a leading staffing consultancy organisation.
The report by TeamLease Services, released on Monday, warns that the quality of labour force (projected to reach in 2020 the level of the total population of the country when the economic reform started in 1991) will not be encouraging. At that time, only 88 million people will be graduates, while another 76 million would have completed higher secondary education. "Education achievement by itself may not be an adequate measure if the quality of the education is not captured,'' it adds.
It points out that India is the only country in the world that is growing younger: its working population between 20-59 years of age is 567 million 2006. The labour force in 2020 will number around 716 million.
Projecting a requirement of an additional employment of 15 million per year (against 10 million usually cited by government reports) to solve the problem of unemployment, the TeamLease report says that employment has grown mainly in the unorganised sector where the growth rate in jobs was 30.29 per cent in the Nineties against 29.62 per cent in the Eighties. Employment growth in the organized sector has slowed down distinctly, it says. "The annual average growth in employment has slowed down with the bulk of the unemployed being the youth.'' It cites data from the National Sample Survey Organisation (NSSO) to highlight that across all social groups, between 85 and 90 per cent of the unemployed are accounted for in the 15-29 age group, in both urban and rural areas.
The report ranks States in terms of what it calls the "Labour Ecosystem''. Constituents of this system a good economic (employment) system, employability and legal and regulatory structure leading to a good environment for employment creation "are all mostly determined by State-level efforts,'' it says.
Making out a case for greater decentralisation and making Labour a State subject, it says that good overall employment generation conditions lead to greater growth. It has ranked States in terms of the Overall Labour Ecosystem, whereby the top three that emerge are Delhi, Gujarat and Karnakata, while at the bottom are Jammu and Kashmir, Bihar and Uttar Pradesh.
The rankings in terms of sub-indices are as follows:
Labour Demand Ecosystem: top rankers Gujarat, Goa and Himachal Pradesh; bottom three, Bihar, UP and J and K.
Labour Supply Ecosystem: top rankers Goa, Karnataka and Tamil Nadu, and bottom three Assam, Bihar and J and K.
Labour Law Ecosystem: top rankers Delhi, Gujarat and Karnataka, and bottom three J and K, Bihar and Uttar Pradesh.
The report lists various legal provisions in the plethora of industrial relations legislation - besides some court rulings -- that have imparted rigidity to the labour market and thus hindered growth of employment and labour-intensive production.