INDIA INC.'S JOBS CHALLENGE

AS THE JOB MARKET CONTENDS WITH THE DOMINANCE OF INFORMAL WORK, THE SERVICES AND MANUFACTURING SECTORS FACE MASSIVE CHALLENGES IN THEIR BID TO CREATE QUALITY JOBS.

- MANOJ SHARMA

INDIA’S JOBS crisis has persisted for decades, with successive governments unable to resolve it. Though India’s unemployment rate has come down over the years, about 82% of the population is still dependent on the informal sector. The proliferation of informal employment has created a ‘bubble-like situation.” Despite a low reported joblessness rate, underemployment is widespread. And youth unemployment is a critical pain point. Around 65% of India’s population is under 35 and 27.2% is between 15 and 29. Self-employment, the most widespread, provides little income.

The solutions are not easy to come by considering the contradictory picture given by different unemployment figures. Official data shows low unemployment but numbers from Centre for Monitoring Indian Economy (CMIE), a private think-tank, tell a different story. The latest Periodic Labour Force Survey (PLFS) shows that India’s unemployment rate of 3.2% in 2024 (July 2023–June 2024) is below the global average of 5.1%. It dipped from 6% in 2018 to 4.2% in 2021 and 3.6% in 2022. At the same time, the youth unemployment rate declined from 17.8% in FY18 to 10% in FY23. It had surged from 5.7% in 2000 to 17.5% in 2019 before easing to 12.4% in 2022 and 10% in 2023. Post-Covid, there has also been an increase in female participation, thanks to supportive central government policies. The labour participation rate for women older than 15 years surged from 22% in FY18 to 40.3% in FY24. The progress can be attributed to schemes such as MUDRA, Kaushalya and MNREGA (Mahatma Gandhi National Rural Employment Guarantee Act, 2005) that focus on self-employment and skill development. Still, India has one of the lowest female labour participation rates, indicating room for progress. However, in spite of low unemployment figures, a concerning trend has emerged.