A Republic of the jobless youth

Providing and creating jobs was one of the major points in the manifesto released by the Bharatiya Janata Party in 2013 in the run up to the Lok Sabha elections. In fact, at a rally in Agra in 2013, Narendra Modi had said the BJP would create 10 million jobs. And, not enough jobs have been created. The number of unemployed persons still hovers around 40 million for the last few years. We have, of course, come a long way from 1947, but much needs to be done.

The 2016-17 economic survey states, employment growth has been sluggish. According to the State of India’s Livelihood Report 2017 by Narasimhan Srinivasan and Girija Srinivasan, published by Sage, “Growth in itself is not the final objective in a developing country, but expanding employment and thriving livelihoods is.” But, now the government is singing the tune that they have turned job seekers into job creators.

Even the Reserve Bank of India’s October 2017 Consumer Confidence Survey shows that public perception is also beginning to take account of the fact that there are no jobs available in the economy. According to the survey, 43.7 per cent of responders felt that the employment situation had worsened as compared to 31.9 per cent a year ago.

According to the Ministry of Statistics, the index of industrial production declined and for the first time since 2013, showed a negative growth rate in 2017. Private investments have been declining for some time, states the report. The government, which was confident of high growth rates till recently, is worried; finance minister Arun Jaitley stated that it was a matter for concern that the GDP growth in the first quarter of 2017-18 is a matter of concern.

According to the report, the total workforce in the country is estimated to rise to 495 million by 2019-2020. National Institute of Labour Economics Research and Development had stated that 72 lakh adults are added to the workforce each year. The employment and unemployment survey carried out by the Ministry of Labour and employment in 2016, states that 50.3 per cent of all adults above 15 years of age were either employed or actively seeking employment. The Survey also confirmed the trend of low participation rates from among women. The report adds that, while the labour force participation rates were 75 per cent in the case of males, it was only 23.7 per cent in case
of females.

Organisation for Economic Co-operation and Development, in its India Economic Survey 2017, pointed out that 30.8% of Indian youth are not engaged in any purposeful activity. This points to a significant lack of immediate or long-term employment opportunities. The unemployment rate was 5.1 per cent in the rural sector and 4.9 per cent in the urban sector.

Statistically, 47 per cent people in rural India and 39 per cent people across the country, although employed, did not have full time work. They work for only a part of the year. Majority of the workers, 95 per cent casual and 67 per cent of contract workers, did not have a written contract issued to them by their employers. “This is a grave situation and needs priority attention,” added Srinivasan.

Estimates are that about 475 million people are employed with very little job security and almost no legally enforceable rights. Their working conditions are highly uncertain in the informal sector and they could lose their jobs any time. Post demonetisation, Centre for Monitoring Indian Economy (CMIE) had estimated that about 1.5 million jobs had been lost in the first quarter of 2017 as a consequence of demonetisation. These have occurred only because of the absence of protection and nature of employment in the informal sector.

International Labour Organisation had published the employment to population ratio, which shows that the proportion of people that are of employable age (15+) is consistently falling. While over the last five years, the fall in ratio is not dramatic, the low proportion in employment is a matter deserving urgent attention.

Across states, it was found that Himachal Pradesh, Kerala, Jammu and Kashmir, Uttarakhand, Uttar Pradesh and Punjab reported the highest unemployment rates. In case of Himachal Pradesh, the situation seems to have worsened as in the last survey in 2013-14, the unemployment rate was 1.8 per cent and in the current survey it is 10.2 per cent. In the case of Uttar Pradesh too, the unemployment rate increased from four per cent in 2013-14 to 5.8 per cent in 2015-16. Around the same period, Uttar Pradesh has topped the chart for gender crime and murders. The state recorded 14.5% of the total cases of crimes against women and Uttar Pradesh has reported the highest number of murder cases with a total of 4,889 cases in the year 2016.

“Joblessness has not really improved. Every year there is an addition to the labour force and this increases the existing numbers. The indictors that we have been using to check unemployment ratio needs to be corrected. The unemployment ratio is around five per cent, but those not in employment, education or training (NEET) for India was 30.8 per cent. This points towards a significant lack of long-term employment opportunities. So, we are understating the problem, which means the solution will also be understated,” says Niranjan Srinivasan, the co-author of the report and a financial policy maker.

The employment-unemployment survey also found that 67 per cent of households have a monthly income of less that ₹10,000. The report states that this points towards the very marginal existence that households have to deal with very low wage rates. Ironically, the same survey found that with increased education, the level of unemployment increases. The more educated the persons are, the less they are able to find jobs which they think will suit their skills as also their aspirations.

However, the Srinivasans state in their report that educational attainments do not automatically seem to lead to “good jobs”. First, the number of jobs that get created at different employer establishments are far too few to accommodate all those aspiring “good jobs”. The second part is that the employability of those who are turned out of universities is also a major factor in the employers’ mind.

Most people who pass out of different courses, including technical courses, are unable meet the demands of jobs in business and industry. The entire issue of employability being a skill-gap-related problem thus comes to the fore.

The performance of Start-up India, Stand-up India and Make-in India campaigns has not been overwhelming. So far, 3,160 start-ups have been recognised by the Indian government and funding has been provided to 67. According to a report Economic Times, of all the 2,281 ventures that started since July 2014, 997 have shut down, making it a failure rate of 43.7 per cent. While the average age of failed ventures was 11.5 months, the ones that got funds lasted a little longer, that is until the funds lasted. Apparently, the pace of failure may have picked up. In 2015, 15 start-ups shut down, while in 2016, 29 shut down in the first six months of
2016 alone.

After pursuing an impossible 500 million skill training target, the newly constituted Ministry of Skill Development and Entrepreneurship, set out to train 12.56 million people in 2015-16 against which 10.41 million people were trained. In 2016-17, the target was lowered to 11.75 million, against which 6.03 million were trained.

The assumption here has been that once a person gets skilled, employers will provide a job, which has been belied. The gap between enrolments and certification is large. Ensuring such persons get to complete their courses and attain skill levels sufficient to be employed is a priority need.

“The effort that is going into skill-development does not address the underlying problem of lack of jobs. How many similar number of jobs can be created? There are only so much carpenters, engineers, plumbers and drivers that are required. We need to look at it differently,” points out Srinivasan.

What kind of practices can produce jobs? The number of people dependent on agriculture is put variously between 50 per cent and 70 per cent. Even within the sector, the riskiest of livelihoods exist among the very small and fragmented holdings that constitute 85% of the farmer population. Srinivasan believes that any effort in creating jobs should involve making agricultural practices sustainable. “Prices of produce should be remunerative, and the government should look at developing the sector as many jobs within the sector can provide a sustainable livelihood to those involved. It then doesn’t come with the need to change jobs and lack of facilities,” adds Srinivasan.

Agricultural livelihoods have been less secure compared to other livelihoods in the country and that needs to be rectified. A focus only on industrialisation will only add to the unrest on ground.

This, in turn, has led to India slipping on the Human Development Index. The country has slipped from 130 in 2014 to 131 in 2017. What this means, according to World Bank, is that one out of every five Indian is poor, aggregating to 27 crore poor people. Seven low-income states carry 62 per cent of India’s poor.

The report states that the vision of India in the 2015-16 union budget accepted by the government had two major planks – one is that the growth will be equitable and the other was that growth would be inclusive. But, there have been conflicts and these have risen from attempts to deny equitable share of growth and incomes and from exclusion of people from what is rightfully theirs. The divergence between growth and poverty and value added and employment has never been satisfactorily understood and acted upon. It needs to be acted upon, if we have to move towards an equitable society, which can only be achieved if more people have jobs that allow them the basic necessities of life.