Skip to main content

India's organized sector job creation plummets post-2010, leaving people under-employed, poorly paid: OECD report

By Our Representative
The Organisation for Economic Co-operation and Development (OECD), the inter-governmental body of rich western countries, has regretted that India has been creating “too few quality jobs to meet the aspiration of its growing workforce, leaving many people under-employed, poorly paid or outside the labour force.”
The report “OECD Economic Surveys: India”, released last month, says, “Despite strong economic growth, the employment rate has declined, the participation rate of women is low and job creation in the organised sector has plummeted since 2010.”
Stating that “inequalities in wages and in social and labour law coverage are large”, the report says, “Only one third of all workers have a written job contract”, with a “vast majority, particularly those in agriculture and the service sector not covered by core labour laws.”
In manufacturing, says the report, around 65% of jobs are in firms with less than 10 employees (the so-called unorganised sector), while most labour laws apply only to larger firms. In addition, larger firms tend to increasingly rely on temporary workers or workers contracted through an agency (so-called “contract” labour).
Pointing towards “an increase in the share of contract labour in the organised manufacturing sector from 15% to 26% in the first half of 2000s, the report says, “A contract worker earns 29% less than a regular worker.”
“Likewise”, the report says, “In the education sector, contract teachers are paid a small fraction of the wage received by government regular teachers and are often paid with a delay.”
Yet, ironically, the OECD report blames this state of affairs on “complex and strict, especially for large industrial firms”, with employment protection legislation being “particularly restrictive”.
“Firms with more than 100 employees are required to obtain prior government approval to dismiss one or more employee”, it says, adding, “The frequency of reinstatement orders in the case of unfair dismissal is high and long delays in resolving labour disputes add to uncertainty and indirect costs of labour.”
It fact, it criticizes social security contributions, which, it says, "are capped and are mandatory below a given income threshold for firms with more than ten employees", which "increase the cost of low-qualified jobs and discourage job creation.”
The result has been, the report says, “Overall, enterprises have reacted to labour and tax regulations by substituting capital for labour, staying small, or relying on contract labour.”
Praising the Government of India for “envisaging rationalising 44 central government laws into four labour laws”, the report says, “Promoting quality employment and reducing both labour informality and income inequality would require introducing a simpler and more flexible labour law which does not discriminate by size of enterprise, gender or job contract.”
Noting that “employer surveys indicate skills shortages in ICT, financial services, tourism, retail and skillintensive manufacturing”, the report quotes “Quoting National Employability Report: Aspiring Minds (2016)”, to say that 58% of employers reported recruitment difficulties “because of talent shortages.”
It insists, “Large sections of the educated workforce have little or no job skills, making them largely unemployable.”
“It is estimated that only 4.7% of the total workforce has undergone formal skill training, much less than in China or South Korea”, the report says, adding, “To improve population skills, vocational training should be introduced earlier in the school curricula.”

Comments

TRENDING

Nirma varsity demand for higher fees 'illegal', violates Article 14: Letter to Gujarat HC

Counterview Desk
Students of Gujarat’s top private institute, Nirma University, situated in the outskirts of Ahmedabad, in a letter to the Chief Justice the state High Court, have complained that the authorities are demanding “full fees” from students, without taking into account the “disproportionate impact” the lockdown has on the livelihood of students and families.

Buddhist shrines massively destroyed by Brahmanical rulers in "pre-Islamic" era: Historian DN Jha's survey

By Our Representative
Prominent historian DN Jha, an expert in India's ancient and medieval past, in his new book, "Against the Grain: Notes on Identity, Intolerance and History", in a sharp critique of "Hindutva ideologues", who look at the ancient period of Indian history as "a golden age marked by social harmony, devoid of any religious violence", has said, "Demolition and desecration of rival religious establishments, and the appropriation of their idols, was not uncommon in India before the advent of Islam".

Vulnerable to Covid-19, sharp rise in murder of Indian journalists during pandemic

By Nava Thakuria*
Vulnerability of working journalists in India is no way an alien issue as the populous country loses a number of working journalists to assailants as also medical emergencies. Even though there was only one casualty in the Indian media fraternity during the first half of 2020, who was targeted for journalistic work, India has begun witnessing an alarming number of media casualties during the Covid-19 pandemic.

Govt 'assures' Gujarat HC no action against MBBS students defying corona sahayak order

By Our Representative
The Gujarat government has assured the High Court that no action would be taken against Part-I and Part-II MBBS students of the Ahmedabad Municipal Corporation (AMC)-controlled NHL Medical College and LG Hospital and Medical College. The assurance follows the direction by Justice SH Vora to the State government not to prosecute or initiate action against the students who were defying the college authorities’ order to work as corona sahayaks (helpers).

Ex-official: Murmu, appointed as CAG, will 'surely' perform shradh of the institution

Counterview Desk
A former senior official of the Comptroller and Auditor General of India (CAG), Shantanu Basu, in a Facebook comment in the wake of the appointment of GC Murmu, a Gujarat IAS cadre official of the 1985, has raised doubts about the independence of CAG following the Government of India move.

Renounced US citizenship to serve workers, tribals, Sudha Bharadwaj 'odiously' in jail

By Atul, Sandeep Pandey*
Professor Sudha Bharadwaj has been in jail since August 2018. She was taken into police custody on August 26, 2018 on suspicion of being involved in Maoist terror activities after Republic TV claimed that she had allegedly written a letter to Maoists and was conspiring to create public disorder and unrest in India.

Undoing 'past wrong' at Ayodhya: Will Modi govt hand over Puri temple to Buddhists?

By Shamsul Islam*
While laying the foundation of Ram Janmabhoomi Temple at Ayodhya on August 5, 2020, with the get-up of a prosperous Hindu sage, Prime Minister Narendra Modi declared that wait of Hindus of the world for centuries was over, as Lord Ram’s birthplace has been finally liberated from numerous attempts to destroy it.

Plant organic, eat fresh: Emlen Bage's journey from migrant labour to agri-entrepreneur

By Chandrashekar and Kriti*
Who is a farmer? Type this question in the google search and check out the images? You can see men thronging the screen. This is the popular perception around the globe. Well one can understand how difficult it would be for a woman to defy this perception.

High youth unemployment: India 'fails' to take advantage of demographic dividend

By Varun Kumar
As coronavirus pandemic continues amplifying challenges among youth with regard to employment opportunities, government policies have further resulted in economic slowdown, leading to mass unemployment and loss jobs. According to the International Labour Organisation report “Covid-19 and the World of Work” (May 27, 2020), around 94 percent of the world’s workers are living in countries with some sort of workplace closure measures in place.