Rojgar Mela – The Core IAS

Rojgar Mela

Unemployment in India: A quick recap of the past five years

  • Unemployment had hit a 45-year high. The government rubbished the PLFS findings and continued to refute them until it was reelected.
  • Between 2012 and 2018, the total employment fell for the first time in India’s history — by as much as 9 million (or 90 lakhs) in 6 years. Worse, it was found that not only had youth unemployment shot up starkly but also that it rose with education attainment.
  • In early 2020, India, like the rest of the world was hit by the Covid pandemic and predictably this worsened unemployment further. Since then we have repeatedly explained why rising unemployment, not GDP growth, is the biggest challenge for India.
  • An unfortunate aspect of the way the unemployment crisis has been unfolding is the worsening impact it has had on the role women in India’s economy. India is no country for working women and earlier this year we explained how India’s workforce is becoming increasingly male dominated.
  • Unemployment situation has improved since the Covid pandemic. Indeed, it would look so if one is not careful. 
  • Recovery in employment may lag economic growth.
  • Indian policymakers may be underestimating the unemployment challenge.
  • Over the past few weeks, it is the alarming trend of how India is becoming a young country but with an ageing workforce.

Rozgar Mela won’t solve the unemployment crisis?

  1. Because the total jobs in question are akin to a drop in the ocean. Even if all 10 lakh vacancies are filled, they are nothing in comparison to the total estimated jobs that India needs to create. According to Radhicka Kapoor, senior visiting fellow at the Indian Council for Research on International Economic Relations (ICRIER), India needs to create anywhere between 20 million (2 crore) to 200 million (20 crore) new jobs.
  2. Because these are pre-existing vacancies, not new job creation.
  3. Because the size of public employment (read all types of government jobs) in India was already quite low. According to a 2019 calculation by academics C. P. Chandrasekhar and Jayati Ghosh, public employees per 1000 population in India (16) was starkly lower than comparable economies such as China (57), United States (87), Brazil (111), and far lower than some of the nordic countries such as Norway (159) and Sweden (138).

Is unemployment an old problem or a new crisis?

  • Some argue that people are making too much of unemployment and that India always had widespread unemployment. Others argue that the unemployment was never this high and that the current crisis has taken shape over the past decade or so.