Lets start with a Lecture by Mr.Swaminathan Gurumurthy
Now if you want to argue about Modi 's performance and declare that he is either very good or very bad then you can use these stats.
But keep in mind that Government just cannot create too many jobs other than in PSUs (which depends on the requirement) and what they invest in infrastructure for example transport , railways etc.
As you are probably aware there are many more sectors. Now , how can government ensure job creation and employment ?
Well there are two steps :-
- Creating a suitable environment to encourage job creators .
Steps taken to cover above points are :-
a) Encourage Manufacturing
As manufacturing increases more and more jobs will be created.Some of the highlights are
b) Reforms to help start ups grow
2. Develop skills among youth to get jobs
Hence both aspects of employment job creation and skill development are in focus by the government. Many of these schemes have already started to show their effects creating jobs in different parts of India. Some of them will show their impact in few years.
One thing we need to remember is that Government can only create a environment to create jobs , it is upto us to take it to a new level.
Unemployment is a situation where in the person willing to work fails to find a job that earns them living.
According to Labour Bureau data released in April 2016, textiles, leather, metals, automobiles, gems and jewellery, transport, information technology and the handloom sectors together created 135,000 jobs during 2015. This is 67% lower than 421,000 jobs that were added in 2014 .
Unemployment rate in India has shot up to a five-year high of 5% in 2015-16 with the figure significantly higher at 8.7% for women as compared to 4.3% for men, says report by Labour Bureau.
- Unemployment rate was 4.9 per cent in 2013-14, 4.7 per cent (2012-13), 3.8 per cent (2011-12) and 9.3 per cent (2009-10).
- Labour Bureau did not bring out any such report for 2014-15.
It is those who are in the low income groups(deprived) who are the most affected by this decision. The daily wage workers, maids, farmers, local vendors, porters etc. In Quora, I have not come across anyone from these professions till date .
GROWTH WITHOUT JOB
Many wonder why an economy supposedly growing at a rate of over 7 per cent is not creating enough jobs. Economists say this is because more work is now being done with fewer employees. "The economy is generating less jobs per unit of GDP," says D.K. Joshi, chief economist at ratings and research firm Crisil.
Illustratively, in manufacturing, if 11 people were needed to execute a piece of work that generated Rs 1 million worth of industrial GDP a decade ago, today only six are needed. Joshi's verdict: "The economy has become less labour-absorbent."
About 12 million people join the job seekers’ queue in India every year. While industry is creating jobs, too many such jobs are in the informal sector, which accounts for 84% of current jobs.
REASONS FOR THE FALL (refer picture above)
- Increased automation of operations.
- India’s growth model is capitalist intensive and less labour intensive.
- Lack of ease in hiring and firing(pending labor reforms) has discouraged industries to hire more.
- High interest rates and excess capacity have hurt expansion plans.
- Falling exports for over a year due to global slowdown.
- Drought like condition for 2 consecutive years have shrunk rural demands.
UNDP REPORT 2016
The United Nations Development Programme (UNDP) report said that while a vibrant informal economy keeps a large number of low-wage workers employed, such employment leads to many problems, including inadequate protection for workers.
- For instance, in India 1 in every 10 workers is employed in the construction sector.
- On the other hand, employment growth in services has been slow in recent years. India’s challenge is to create the conditions for faster growth of productive jobs outside of agriculture.
- Worse, during October to December last year, 20,000 people lost jobs in these sectors, partly because of shrinking exports. Merchandise exports have shrunk for 15 successive months till February as orders continue to dry out from much of Europe.
- This unemployment comes at a time when every sector is short of skilled workers — from masons to teachers to waiters to engineers — perhaps a reflection of an education system that is not imparting skills the economy needs.
- Of India’s 1.2-billion population, 60% are of the working age. And of the 12 million individuals who join the queue of job seekers every year, only 4% undergo vocational training.
THE BIG PICTURE
- The situation has only worsened since, thanks to weak industrial growth, a struggling agriculture sector with widespread drought, cost rationalisations in several sectors and the knock-on effect of a global slowdown.
- Also, traditionally labour-intensive industries are beginning to increasingly mechanise their operations. While it makes them more productive and profitable, it also shrinks job opportunities.
- According to the labour ministry's 27th Quarterly Employment Survey of eight employment-intensive industries- textiles, leather, metals, automobiles, gems & jewellery, transport, IT/BPO and handloom/powerloom)- there were 43,000 job losses in the first quarter of FY 2015-2016. The second quarter was better, with 134,000 new jobs, but even then the 91,000 net new jobs created in the first half of FY 2015-16 look desultory.
- At their peak, these sectors had added 1.1 million jobs in 2010. In the following five years, however, 1.5 million jobs were lost. FY 2014-15 saw a spurt, with 500,000 new jobs added as compared to 300,000 the year before, but it was still half the peak figure. There have been no signs of recovery in FY 2016; in fact, there is a decline.
Image Source - Manufacturing in India (United States department of labor)
The second quarter was better, with 134,000 new jobs, but even then the 91,000 net new jobs created in the first half of FY 2015-16 look desultory.
- At their peak, these sectors had added 1.1 million jobs in 2010.
In the following five years, however, 1.5 million jobs were lost.
FY 2014-15 saw a spurt, with 500,000 new jobs added as compared to 300,000 the year before, but it was still half the peak figure. There have been no signs of recovery in FY 2016; in fact, there is a decline.
One reason for the decline in jobs could be a reduction in contract workers (nearly 70,000 of them were retrenched in the first half of FY 2016, compared to 161,000 additions in the first half of FY 2015).
SOLUTIONS
1. Increase in national wealth through industrialization: The real remedy lies in an addition to the national wealth, in increased production of industrial goods. If there are more industries, there will be more avenues for employment, particularly for men and women with professional and technological training. Already the River valley projects and power-plant projects are finding employment for a large number of men.
2. Establishment of Vocational and Technical training institutes: The government should open Technical and Vocational colleges and manual labor should be made compulsory. Big factories should be attached to these colleges. More stress is to be given to practical side.
3. Increased investment in heavy industries: Investment in heavy and basic industries and consumer goods industries should be increased to provide more employment with more production.
4. Revival of cottage and small scale industries: Cottage and small scale industries should be developed. Subsidies and other incentives should be given to private sector.
5. Modernization of agriculture: Modernization and mechanization of agriculture should be done. Wastelands should be utilized.
6. Improved transport and communication: Rural works programs should be increased means of transport and communication should be developed.
7. Self-employment should be encouraged: Government should take initiatives to encourage self-employment. Young entrepreneurs should be assisted with hassle free loans.
CONCLUSION
There is a clear mismatch between the growth rate of the Gross Domestic Product (GDP) and the growth rate of employment; GDP grows at 7.7 percent whereas employment grows at just 1.8 percent.
Unemployment is a problem beyond politics, religion and the other petty issues; it need to be addressed with at most importance. The reports ascertains that it will affect the life of low income groups and the common man severely if left unchecked leading to economic disparity in India. A growth focused on GDP and discarding HDI(Human development Index) will be a loss for the citizens(common man) of India.
- Unemployment in India: Types, Causes and Solution - Important India
- India staring at job crisis, warns human development report
- Welcome to Jobless Growth: Why India is facing an unemployment crisis(To get a clearer picture explaining the scenario in various sector)
- Ciril J Thundiyil's answer to What is India's unemployment rate now? Has it increased or decreased after Narendra Modi became prime minister?(detailed answer on the present situation)
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