India’s Jobs Crisis

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    • According to the recent trend there are fewer people employed in agriculture today, those moving out of farms are working more in construction sites and the informal economy than in factories.

    Background 

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    • 1993-94: Agriculture accounted for close to 62% of the country’s employed labour force.
    • 2004-05: Survey in these years has dropped almost six percentage points. 
      • The declining trend continued albeit at a slower pace in the subsequent seven as well.
    • Overall between 1993-94 and 2018-19: agriculture’s share in India’s workforce came down from 61.9% to 41.4%.
    • Level of per capita GDP in 2018 and compared with the average for other countries in the same income bracket India’s farm sector should be employing 33-34% of the total workforce. 
      • 41.4% may not be a substantial deviation from the average.

    Issues/ Challenges 

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    • Weak structural transformation: there’s been a reversal of the trend in the last two years, which has seen the share of those employed in farms rise to 44-45%. This has primarily to do with the Covid-induced economic disruptions. 
    • The reverse migration of people back to the farms should be a temporary blip though with the surveys from 2021-22 hopefully revealing a restoration of the long-term trend.
    • Structural transformation: even the movement of workforce from agriculture that India has witnessed over the past three decades or more does not qualify as what economists call structural transformation.
      • Such transformation would involve the transfer of labour from farming to sectors particularly manufacturing and modern services where productivity, value-addition and average incomes are higher.
    • The share of manufacturing (and mining) in total employment has actually fallen along with that of agriculture. 
      • The surplus labour pulled out from the farms is being largely absorbed in construction and services. 
    • Surplus labour isn’t moving to higher value-added non-farm activities specifically manufacturing and modern services.
      • Labour transfer is happening within the low-productivity informal economy.
    • Lack of jobs in manufacturing: It is the sector potentially best placed to absorb the children of farmers and agricultural labourers but the bulk of the rural workforce is engaged in construction and the informal services economy due to lack of jobs.
    • Participation of women: Women suffer job losses disproportionately during economic shocks. The phenomenon repeated itself during the pandemic. 
      • Women accounted for less than 11% of all jobs in 2019-20, but they accounted for nearly 52% of the 7 million job losses since then. 
      • The female labour force participation rate among urban women was abysmally low at 9.4% in 2019-20 and fell to 7% in 2021-22.

    Way forward/ Suggestions 

    • The IT industry is clearly an isolated island of the Indian economy that added jobs during the pandemic and is continuing to do so.
    • Much of the IT sector’s recent success is courtesy of exports: These have in fact boomed due to Covid’s triggering increased demand for digitisation even among businesses that were hitherto slow in adoption.
      • India’s net exports of software services have surged from $84.64 billion in 2019-20 to $109.54 billion in 2021-22.
    • The unemployment situation can be tackled by providing skill development training at a much faster rate than what was happening in the last few years
    • The employment objective and the output objective can be achieved, if greater investment is directed to small enterprises rather than to large enterprises.
    • The Central government can easily give a directive and incentive to the industries to train rural and tribal youth in their establishments so that skill training can take place
    • Social security should be provided to the poor, so that people do not die of starvation.  

    Employment Generation Schemes/ Programmes of Government of India

    • Atma Nirbhar Bharat Rojgar Yojana (ABRY) 
      • It was launched with effect from 1st October, 2020 as part of Atma Nirbhar Bharat package 3.0 to incentivize  employers for creation of new employment along with social security benefits and restoration of loss of employment during Covid-19 pandemic.
    • Pradhan Mantri Rojgar Protsahan Yojana (PMRPY)
      • It was launched with effect from 1.4.2016 to incentivise employers for creation of new employment. The beneficiaries registered upto 31st March, 2019 will continue to receive the benefit for 3 years from the date of registration under the scheme i.e. upto 31st March, 2022
    • National Career Service (NCS) Project
      • Project for transformation of the National Employment Service to provide a variety of career related services like job matching, career counselling, vocational guidance, information on skill development courses, apprenticeship, internships etc
    • Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)
      • MGNREGA is to provide at least 100 days of guaranteed wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work. 
    • Garib Kalyan Rojgar Abhiyaan (PMGKRA)
      • It is a 125-day Abhiyan launched by the Hon’ble Prime Minister on 20th June 2020 with a mission to address the issues of returnee migrant workers and similarly affected rural population by Covid-19 pandemic through a multi- pronged strategy of providing immediate employment & livelihood opportunities to the distressed, to saturate the villages with public infrastructure and creation of livelihood assets to boost the income generation activities and enhance long term livelihood opportunities by giving focus on 25 works in 116 selected districts across 6 States with a resource envelope of Rs 50,000 crore.
    • Aajeevika – National Rural Livelihoods Mission (NRLM)
      • It was launched by the Ministry of Rural Development (MoRD), Government of India in June 2011. Aided in part through investment support by the World Bank, the Mission aims at creating efficient and effective institutional platforms for the rural poor, enabling them to increase household income through sustainable livelihood enhancements and improved access to financial services. 
    • Pt. DeenDayal Upadhyaya Grameen Kaushlya Yojana (DDU-GKY)
      • The Ministry of Rural Development (MoRD) announced the Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) Antyodaya Diwas, on 25th September 2014. 
        • DDU-GKY is a part of the National Rural Livelihood Mission (NRLM), tasked with the dual objectives of adding diversity to the incomes of rural poor families and cater to the career aspirations of rural youth. The website link for the scheme is
    • PM- SVANidhi Scheme
      • Prime Minister Street Vendor’s  AtmaNirbhar Nidhi (PM SVAN idhi) Scheme since June 01, 2020, to provide collateral-free working capital loan to Street Vendors, vending in urban areas, to resume their businesses which were adversely affectedduetoCOVID-19inducedlock-down.  
    • Pradhan Mantri MUDRA Yojana (PMMY)
      • It is a scheme launched by the Hon’ble Prime Minister on April 8, 2015 for providing loans up to 10 lakhs to non-corporate, non-farm small/micro enterprises. These loans are classified as MUDRA loans under PMMY. These loans are given by Commercial Banks, RRBs, Small Finance Banks, MFIs and NBFCs.
    • Pradhan Mantri Kaushal VikasYojana (PMKVY)
      • Pradhan Mantri Kaushal Vikas Yojana (PMKVY) is the flagship scheme of the Ministry of Skill Development & Entrepreneurship (MSDE) implemented by National Skill Development Corporation.
    • Production-Linked Incentive (PLI) Scheme
      • Hon’ble Finance Minister, Smt Nirmala Sitharaman has announced an outlay of INR 1.97 Lakh Crores for the Production Linked Incentive (PLI) Schemes across 13 key sectors, to create national manufacturing champions and generate employment opportunities for the country’s youth. 

    Source: IE