ON GOVT. INTERVENTION
situation in the country continued to be insufficient growth of the nonfarm sectors and the ability of these sectors to absorb workers from agriculture.
“This is notwithstanding the fact that nonfarm employment grew at a higher rate than farm employment over the different periods prior to 2018,” the report said.
Labour from agriculture was mainly absorbed by the construction and services sectors. Also, almost 90% of workers remain engaged in informal work, while the share of regular work, which steadily increased after 2000, declined after 2018.
There are widespread livelihood insecurities, the report added, with only a small percentage being covered with social protection measures, precisely in the nonagriculture, organised sector. “Worse, there has been a rise in contractualisation, with only a small percentage of regular workers covered by longterm contracts,” the report said.
While India’s large young workforce is a demographic dividend, the report noted that they don’t appear to have the skills to deliver — with 75% of youth unable to send emails with attachments, 60% unable to copy and paste files, and 90% unable to put a mathematical formula into a spreadsheet.
The country is also facing the challenge of a substantial gender gap in the labour market, with low rates of female labour force participation.
Social inequalities
Throwing light on the growing social inequalities, the report said despite affirmative action and targeted policies, the Scheduled Castes and Scheduled Tribes still lag in terms of access to better jobs. “Scheduled Castes and Scheduled Tribes have greater participation in work due to economic necessity but engaged more in lowpaid temporary casual wage work and informal employment,” it said. “Despite improvement in educational attainment among all groups, the hierarchy within social groups persists,” the report added.
Asserting that it was incorrect to think that government intervention could solve every social and economic challenge, Chief Economic Advisor V. Anantha Nageswaran contended that a diagnosis was easier than the solution when it concerned issues like unemployment.
Speaking at the unveiling of the “India Employment Report 2024: Youth Employment, Education and Skills” coauthored by the ILO and The Institute for Human Development on Tuesday, Mr. Nageswaran wondered what the government could do on the employment front “short of hiring more itself”.
“In the normal world, it is the commercial sector who needs to do the hiring,” he pointed out, while listing out the actions taken by the government to spur job creation in recent years, such as the skill development efforts and the National Education Policy of 2020, which he stressed should not “become hostage to political considerations.”
The CEA also pointed to the corporate income tax breaks for salary payments as well as subsidies towards provident fund contributions and asserted, “Indeed, we can state very confidently now that the tax code no longer favours capital accumulation over employment generation.”
Citing the 1970s’ satirical film Mohammed bin Tughlaq written and directed by Cho Ramaswamy, the CEA said there is “an element of truth” in what the film’s protagonist, who becomes the fictional country’s Prime Minister and seeks to address problems like corruption, says about unemployment.
“For unemployment, he simply says, “Look, all I will do is I’ll keep talking on every dais and stage that we have to solve the unemployment problem, and that is my contribution to solving the unemployment problem. Because this is not something I can address.”
The CEA also wondered whether governments worldwide were reducing the incentive to work through welfare policies intended to ‘ameliorate the negative consequences of unemployment’ that ended up disrupting the labour market for the worse.