Integrating services into production can create more jobs: CSEP

India's manufacturing sector could generate more jobs by embracing the rising trend of servicification and integrating services into firms' production, sale, and export processes, according to a new working paper by the Centre for Social and Economic Progress (CSEP).

- HIMANSHI BHARDWAJ

Servicification has a positive correlation with employment across a range of sectors, especially textiles, electronics, rubber, plastics and machinery, the paper, 'Servicification of Manufacturing: India's Potential and Policy Priorities', stated.

Services like construction, transport, and distribution play a significant role in supporting job creation in the manufacturing sector, the paper, based on empirical estimates, concluded.

Speaking with Business Standard, economist and visiting fellow at CSEP, Anirudh Shingal, who authored the paper, said that servicification contributes positively to manufacturing employment in India through two key channels- the use of imported service inputs and the upstream positioning of manufacturing firms in global value chains (GVCs).