INDIA EMPLOYMENT REPORT 2024
1. Context
The India Employment Report 2024, prepared jointly by the Institute of Human Development (IHD) and the International Labour Organization (ILO), and released on March 26, revolves around “youth employment, education and skills.” It has analysed trends and patterns of the Indian labour market for two decades, including the COVID-19 years, and listed the “emerging characteristics of the employment challenges now confronting the economy as well as the impact of growth on employment.”
2. What are the key findings?
- According to the report's authors, the percentage of India's working-age population (aged 15–59) rose from 61% in 2011 to 64% in 2021 and is expected to reach 65% by 2036. Each year, approximately 7-8 million young individuals join the labor force.
- Although the proportion of young people receiving education increased from 18% in 2000 to 35% in 2022, the percentage of economically active youth decreased from 52% to 37% over the same period.
- The authors caution that unemployment in the country is mainly a concern among the youth, particularly those with a secondary education or higher, and this issue has escalated over time.
- They highlight that in 2022, nearly 82.9% of the total unemployed population consisted of young individuals. Additionally, the proportion of educated youth among all unemployed individuals rose from 54.2% in 2000 to 65.7% in 2022.
- Furthermore, among educated unemployed youth (with a secondary education or higher), a larger percentage were women (76.7%) compared to men (62.2%)
3.What is the quality of employment?
- According to the ILO and IHD, employment remains characterized by low productivity and earnings, with real wages either declining or stagnating.
- A significant portion of both regular (40.8%) and casual (51.9%) workers fall short of receiving the average daily minimum wage set for unskilled labor, which stands at ₹480 per day as mandated by the government.
- The findings of the report have raised concerns among central trade unions and the Samyukt Kisan Morcha. Senior trade union leader Amarjeet Kaur highlights the "wage depression" highlighted in the ILO report, particularly alarming amidst unchecked food inflation.
- She notes that formal employment accounts for a mere 9% of total employment, leaving the majority of the workforce without any social security coverage.
- Kaur underscores the detrimental impact this has on unemployment and underemployment, as those without formal jobs struggle to invest in education and skill development for future generations.
- The authors of the report suggest that individuals with higher levels of education are more likely to secure stable, formal employment with higher earnings.
- They point out that youth in the southern, western, and northeastern regions have better prospects of formal employment, while also highlighting the prevalence of socially marginalized youth in informal sectors
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Why are jobs scarce in the formal sector?
Trade unions contend that thousands of posts have not beenfilled for years and the policy of letting one-third of the vacancies lapse after retirements have resulted in the decrease of formal employment. The trend of contractual appointments and clamour for consultancies are also blamed for the dip in formal jobs.
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4.Gender Gap
- A notable disparity exists in the labor market concerning gender, marked by a low level of female participation. The authors of the report observed that this gender gap in labor force participation rates has remained relatively stable over the last two decades.
- In 2022, the participation rate of young men in the labor force stood at 61.2%, nearly three times higher than that of young women, which was at 21.7%. This gender discrepancy was consistent across both rural and urban areas. The report's authors also highlighted a significant portion of young individuals, especially women, who are neither in education, employment, nor training.
- Between 2012 and 2019, there was a concerning rise in unemployment attributed to the declining participation of women in the workforce. However, this trend has seen a slight reversal post-2019
5. Recommendations of Report
- The authors of the report projected that India would experience sustained economic growth of 5-6% over the next approximately 15 years. They emphasized that rapid technological advancements and economic expansion have widened the gap between the supply and demand of skills.
- Therefore, policymakers were urged to implement targeted measures to swiftly integrate young people into the workforce.
- To tackle these challenges, the authors proposed "five missions": enhancing employment intensity in production and growth, enhancing job quality, addressing labor market inequalities, improving the effectiveness of skills training systems and active labor market policies, and addressing knowledge gaps regarding labor market trends and youth employment.
- They suggested integrating employment generation with macroeconomic and other policies to promote productive non-farm employment and advocated for supporting micro, small, and medium-sized enterprises while promoting decentralization
6. Way Forward
The report’s authors have urged the government to take steps to increase agriculture productivity, create more non-farm jobs and promote entrepreneurship. Calling for a focus on policies that boost women’s participation in the labour force, theyalso sought a minimum quality of employment and basic rights of workers across all sectors
| For Prelims: Labor Force Participation Rate (LFPR), Employment Rate (ER), Centre for Monitoring Indian Economy (CMIE), and Labour Force.
For Mains: 1. Discuss the significance of the Labor Force Participation Rate (LFPR) as a critical labor market indicator in the context of economic development and policy formulation. (250 words).
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Previous Year Questions
1. In India, which one of the following compiles information on industrial disputes, closures, retrenchments, and lay-offs in factories employing workers? (UPSC 2022)
A. Central Statistics Office
B. Department for Promotion of Industry and Internal Trade
C. Labour Bureau
D. National Technical Manpower Information System
Answer: C
2. Which of the following brings out the 'Consumer Price Index Number for Industrial Workers'? (UPSC 2015)
A. The Reserve Bank of India
B. The Department of Economic Affairs
C. The Labour Bureau
D. The Department of Personnel and Training
Answer: C
3. International Labour Organization's Conventions 138 and 182 are related to (UPSC 2018)
A. Child labour
B. Adaptation of agricultural practices to global climate change
C. Regulation of food prices and food
D. Security
Answer: A
4. Which of the following statements about the employment situation in India according to the periodic Labour Force Survey 2017-18 is/are correct? (UPSC CAPF 2020)
1. Construction sector gave employment to nearly one-tenth of the urban male workforce in India.
2. Nearly one-fourth of urban female workers in India were working in the manufacturing sector.
3. One-fourth of rural female workers in India were engaged in the agriculture sector.
Select the correct answer using the code given below:
A. 2 only
B. 1 and 2 only
C. 1 and 3 only
D. 1, 2 and 3
Answer: B
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Source: The Hindu
