Sluggish growth of job opportunities in India

Sluggish growth of job opportunities in India

In India,  the proportion of unorganised sector (informal sector) workers continues to remain high. The data clearly indicates that despite more than half a century of planned economic development the proportion of formal sector in total employment has not shown any significant progress. Furthermore, even after the introduction of neoliberal economic reforms the formal sector has registered marginal or nil growth even in the highly industrialised urban centers of India. The way in which the urban informal economy has grown during the decades suggests that self-employment and very small economic units in the trade and service sub-sectors will prevail in the foreseeable future. This type of activity has much lower entry barriers in terms of level of skills or capital required than the micro-enterprise type. It is better suited to absorb the new entrants to the labour force and rural migrants. On the other hand, with greatly depressed incomes in informal trade and service activities due to the growth of this sub-sector, the increase in the number of economic units might have limits. Informal sector includes a wide range of economic activities participated by self-employed, casual workers, unpaid family workers, etc., and tiny units in manufacturing, construction, trade, transport and servicing.18 Typical informal sector participants include petty traders, platform vendors, coolies, artisans, masons, carpenters, general helpers, leather workers, handloom weavers, hair dressers, beauticians, launderers, electricians, electronic goods repairers, automobile mechanics, milkmen, shop assistants, sales girls, teachers (employed in unorganized and unaided schools, colleges) and other such educational institutions), hotel workers, cobblers, scavengers, shoeshine boys, animal/hand cart pullers, taxi/auto drivers, cycle rickshaw pullers, and the list is endless. Many of those employed in informal sector activities work only part of the day, part of the week ,or part of the year in odd jobs with low wages. Millions work as casual labour and others work long hours for a pittance. Driven by the force of circumstances they engage in all kinds of activities with low wages and no security. Many households have to eke out subsistence under very difficult conditions, being dependent mostly on the earning capacity of the household members including children. What work they can find is usually piecemeal, unstable and insecure, not to mention of backbreaking and tedious; yet they work hard day in and day out in order to earn for the sustenance of their families at the subsistence level.

The continued sluggish growth of employment in India is a cause of grave concern. Data clearly indicate that during the neoliberal economic reform period since 1991 growth of employment has been slow. Employment growth in the organised sector, public and private combined, declined during 1994-2012 compared to 1983-1994. This has primarily happened due to decline of employment in public organized sector. Employment in establishments covered by EMI grew at 1.20 per cent per annum during 1983-1994 but decelerated to –0.31 per cent per annum during 1994-2004. However, the decline in the latter period was mainly due to a decrease in employment in public sector establishments, whereas the private sector had shown slight increase in the growth in employment from 0.44 per cent to 0.58 per cent per annum during 1994-2004. Recent data show that between 2004 and 2012, jobs have increased at an awfully low rate of just 2.2 per year. But the organised sector employment growth was abysmal low. The recently released survey findings from the NSSO show that bulk of employment growth during 2004-2012 has occurred in services especially in retail trade, construction and personal services, which constitute low-paying and tough jobs generally termed as informal sector activities. The growth of organised sector employment in general has been sticky during 2004-2012 and whatever employment growth is taking place is only in the informal sector. The impact of slow pace of employment growth in the organised sector, particularly in the public sector is more severe in the case of the educated youth belonging to the socially weaker sections of the society. The minor gains arising out of the new economic policy have gone to a small segment of the society. When the process of industrialisation and modernisation is rapid enough to create adequate job opportunities with increased productivity and higher wages, the gains of development will percolate to a larger segment of the society. On the other hand, if the process is not rapid, the benefits will accrue to those whose initial economic, social and political conditions enable them to take advantage of modernisation. In India, only a small proportion of the work force is able to occupy jobs with high earnings in the modern industrial sectors and the associated tertiary sectors such as the entrepreneurial, industrial, business (executives), administrative, bureaucratic, professional, white collar workers, and managerial and supervisory cadres of the workers employed in the organized sectors. The entry in these sectors is limited due not only to their small size, but mainly because of lack of education, training, initiative, innovative skills and resources, besides the use of capital-intensive technology. Consequently, the process of development has benefited the upper-middle and the richer sections, which invariably belong to the forward communities, much more than the middle, lower middle and the poorer sections,which has affected particularly the backward classes and the Dalits.