Employment Growth In IT Sector Slides Down in 2017-18

Nobel Laureate and economist Paul Krugman has recently remarked that lack of employment poses the biggest risk to India even as he has remained optimistic about the growth story that will be driven by the world’s fastest-growing economy’s young population.

- Tushar K Mahanti

With the fear that India is experiencing a jobless growth and skepticism abounding in the country that the government’s reform measures are failing to create enough new jobs, policymakers are facing a difficult challenge.

India will need to generate 280 million jobs between now and 2050, the year when the working-age (15-60 years) population will peak, according to a new United Nations Development Programme (UNDP) report titled, ‘Changing the Future: How Changing Demographics can Power Human Development’. The report has warned that the country’s demographic dividend could be at the cusp of a disaster unless enough jobs are created to these new entrants.

But 2050 is still a distant future. Right now, the panic of a squeezing job market has become the centre of debate. According to Krugman there are two schools of thought on the state of employment in India. One is the fact that more and more people are coming into formal employment, which could be a trigger for growth while the other is the fact that the mass unemployment in India is a potential trigger for an economic catastrophe.

But despite this dichotomy Krugman is optimistic about India’s economic prospects. His optimism stems largely from Indian technocrats’ ability to catch up on technology with the advanced peers. This probably explains a part of India’s high economic growth without corresponding rise in employment.