The issue of unemployment remains a prominent topic for political and social discussion, exacerbated by the COVID-19 lockdown. With this in mind, Centre for Work and Welfare (CWW) at the IMPRI Impact and Policy Research Institute and Centre for Development, Communication and Studies (CDECS), Jaipur organized a panel discussion under The State of Development Discourses – #CohesiveDevelopment on “How to Resolve Unemployment Problem in India”
Dr Arjun Kumar, Director at IMPRI gave a brief presentation to provide an overview of the unemployment crisis in India. The sources of employment statistics in India include Census, National Sample Surveys (NSS), Periodic Labour Force Surveys (PLFS), Labour Bureau, Chandigarh, Government Registries such as Employment Exchange and Migration Data, Private Databases such as Centre for Monitoring Indian Economy (CMIE) and IMPRI, Government Databases such as Employees’ Provident Fund Organisation (EPFO) and MNREGS, Corporate Databases such as Naukri.com and LinkedIn, and Independent HR.
Looking at the trends in unemployment, certain features stand out:
- Since 2010, the unemployment rate has been declining across all age groups.
- Starting from 2017, the rate hovered around 4%, rising to 6-7% within two years and jumping to 25% due to the lockdown measures. The rate then moved in tandem with the COVID-19 waves. The rise in the unemployment rate during the second wave was not as devastating as the first one.
- Among daily wage workers and salaries workers, the former have been the most hard- hit.
- Women’s labour force participation has been declining, especially the youth in the marginalised classes.
- India has not been able to reap the benefits of demographic dividend as only 5.5 million additional jobs have been created against 8 million youth joining the labour force during 2017-18.
Lack of policy and statistical architecture including industrial policy and employment policy, youth and female unemployment, and livelihoods in lockdown are pertinent issues facing policy makers and the country.
Prof Sunil Ray, Former Director, A. N. Sinha Institute of Social Studies, Patna; Advisor, CDECS and IMPRI, the chair and moderator set the tone for the discussion by highlighting a set of major concerns. Theoretical debates on employment by economists include analysing the market economy and providing solutions within the frameworks of Keynesian and Milton Friedman economics. In addition to the unemployment, low wage rates of the migrant workers were exposed during the lockdown. A common assumption within the policymakers was that by targeting growth, other aspects like unemployment would be taken care of by the market. This was proved false by the ‘jobless growth’ the economy experienced. While disguised unemployment was tackled to a certain extent by MNREGA, educated unemployment remains a cause of concern. Among emerging economies, India had one of the highest unemployment rates and lowest growth rates during the COVID-19 pandemic.
So, Prof Ray asked what kind of structural transformation or policy shift in the structure of governance, production, investment and entrepreneurship or injecting a different culture of conjunction is needed to solve the problem of unemployment. Instead of focusing on catching up with the western countries, one should look at growth that is beneficial for the majority. Prof Ray emphasized the concept of collective entrepreneurship, which are missing in India, to strengthen the indigenous production process and reduce dependency on imports.