For a nation that has had a significant demographic dividend — the working age population is much larger than the non-working age sections — finding productive employment for its youth was to be an imperative for India. Yet, in the last few years, unemployment has remained a major concern — the leaked Periodic Labour Force Survey (PLFS) in 2018 revealed that India’s unemployment rate was the highest (6.07%) in four decades. The latest PLFS suggests that the numbers now are not so drastic, with the overall unemployment rate at 4.2% in 2020-21 compared to 4.8% in 2019-20 and the labour force participation rate (LFPR) increasing to 41.6%, up from 40.1% in 2019-20. In terms of the more widely used statistic internationally, the current weekly status of unemployment, the figure of 7.5% for all persons in 2020-21 is still worrying. But, the PLFS data will not bring much cheer to the Government despite a decrease in unemployment, according to official data. This is because the decrease, says the PLFS, has also coincided with the transfer of employment into lower productive and unpaid jobs away from salaried employment. Worryingly, industrial jobs have decreased with more employment in agricultural and farm-related jobs — a trend that accelerated following the lockdown and has not reversed since then. Unemployment rates among the educated (above secondary education — 9.1%) and the youth (age between 15-29 — 12.9%) have only declined marginally.
Wage rates have continued to remain lower for those employed in either salaried jobs or self-employed compared to the pre-pandemic period, with the increases being marginal in the year following lockdown-driven days of the pandemic. It is clear that the Government must tackle unemployment and, concomitantly, the quality of employment issue, on a war footing. In this regard, Prime Minister Narendra Modi’s announcement that the Government will be recruiting 10 lakh personnel within the next 18 months (vacancies in the Railways, the armed forces and GST departments among others) should be seen as a step in the right direction. The latest data showed that there were 8.86 lakh vacant jobs among all central government civilian posts as of March 2020. Mr. Modi’s announcement was not about the creation of a large chunk of new jobs; the bulk of the promised employment is to fill up vacancies. But even this measure would be ameliorative in the real economy that continues to remain distressed, a consequence of the BJP-led government’s mismanagement and the effects of the pandemic in the last few years. The country cannot afford to squander more years in its race to reap the benefits of its demographic dividend, and the push to provide jobs for those seeking to enter the labour force, even if belated, will help ease matters for the medium term.
