Skip to main content

35% of India's workforce underemployed, sharp drop in agricultural job creation due to slowdown: McKinsey report

By Rajiv Shah
One of the world’s topmost consultants, McKinsey, has suggested that the official unemployment rate of just about 4% hides the fact that India has a huge army of underemployment. Pointing out that in India’s context “unemployment is not really an option”, it underlines, here, “entering the informal sector as a worker is the norm.”
“Some 86% of India’s workforce is employed in the informal sector, and more than 90% is in informal employment”, the McKinsey Global Institute’s new report says, adding, “Rarely would a poor rural boy who had dropped out of school remain ‘unemployed’ – he would typically be put to ‘work’ on his family’s small piece of land or would lend a hand at the local kirana shop owned by his uncle.”
Emphasizing that “being employed disguises the slack of underemployment”, the report , released early this month, says the number of jobs created according to India’s surveys “does not help us assess growth in the amount of work done (or so-called man-days or man-hours actually worked).”
Pointing out that the Labour Bureau has classified work in four categories – those who found work for 12 months, six to 11 months, one to five months, and less than one month” -- the report says, by this measure, just about “65% of those seeking full-time work through the year found it”, while the rest, 35%, waited for work “in rising gainful employment, although not in new job creation.”

Drop in agricultural employment
Quoting Labour Bureau data, the report says, there has been a remarkable sluggishness in job creation in India, with the total number of jobs rising from 455 million to 462 million between 2011 and 2015.
At the same time, the report says, this “apparent sluggishness in job creation disguises significant structural change: agricultural employment fell by 26 million and non-farm employment rose by 33 million, or by more than eight million jobs a year.”
Noting that the pace of non-farm job creation dipped during the economic slowdown years of 2011 to 2013 to as low as eleven million, and rose sharply to 22 million during the following two years, the report says, “Labour moved out of agriculture into construction, trade and hospitality, and transport, the mainstays of the non-farm labour market in many developing countries.”
“By contrast”, the report states, “Mining and manufacturing lost jobs during the slowdown, although manufacturing jobs seem to have grown between 2013 and 2015. The growth in non-farm jobs in India is also evident in the growth in number of Employees Provident Fund members. Membership grew at a 7 percent rate, from 32.6 million in 2013–14 to 37.6 million in 2015–16, and currently stands at 45 million.”
However, the report regrets, “Despite the growth of non-farm employment, India’s overall labour force participation rate (the share of the working-age population looking for work) fell by three percentage points, from 55.4 percent in 2011 to 52.4 percent in 2015.”
In fact, the report states, “The movement of workers from farm to non-farm jobs has not been rapid enough to account for growth in the working-age population.” Thus, it adds, “The labour force participation rate for urban males appears to have dipped the most, from 73.7 to 69.1 percent over the period.”

Comments

Unemployment Allowance as Social Security to Avail Right to Life Guaranteed by the Constitution of India is Long Overdue.

TRENDING

Iswarchandra Vidyasagar was a 'frustrated' reformer who turned into a conservative

By Bhaskar Sur "If someone says the Manusamhita was written by all wise Manu and the principal scripture of the land and if he asks me to throw it away, I'll say it is nothing short of atrocious audacity." -- Iswarchandra Vidyasagar

Why do I lend my support to voices protesting world class renovation of Gandhi Ashram?

By Martin Macwan* One would not expect an activist working on Dalit rights to join such a protest. Dalits carry unhealed trauma that Gandhi caused to Dr BR Ambedkar and the Dalit cause of effective political representation by using violent means of his own definition in the event of the Poona Pact. This apart, Gandhi’s ideas in general, which changed often, on caste were orthodox. I have nothing to add to the subject after the sharpest critique offered by Dr Ambedkar.

2002 riots: Gujarat assembly 'misinformed' about dereliction of duty, says ex-DGP

By Rajiv Shah  Former Gujarat topcop RB Sreekumar, an IPS officer of the 1971 batch, has alleged that the Gujarat government gave “totally false information” on the floor of the State Assembly regarding the appeal he made to the Gujarat governor for the “initiation of departmental action against those responsible for culpable negligence in maintenance of public order and investigation of genocidal crimes” during the 2002 riots.

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

Odisha bauxite mining project to 'devastate' life of 2,500 Adivasi, Dalit farmers: NAPM

Counterview Desk  While the public hearing on mining in Mali hills has been cancelled due to protests by Adivasi and Dalit farmers of the Mali Parbat Surakhya Samiti, Odisha, who have been protesting against the proposed bauxite mining project, India’s top civil rights network, National Alliance of People’s Movements (NAPM) has said it is “deeply concerned” at the decision of the Government of Odisha to push the project in a Schedule-V Adivasi-belt Koraput district against the interests of the people and environment.

'Devastating impact': Rural workers suffer as Govt of India NREGA budget down by 34%

Counterview Desk  A civil rights group, the NREGA Sangharsh Morcha has sent a letter to the Prime Minister and the Minister of Rural Development and Panchayati Raj stating that 34 per cent decrease in the fiscal budget of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) for year 2021-22 has added to woes on India’s rural population, already suffering from “devastating impact” of the Covid-19 pandemic.

Economy in tatters, labour codes 'take away' workers' safety, benefits, right to form TU

By Our Representative  The four new labour codes promulgated by the Government of India came in for sharp criticism from several labour unions and civil rights groups at one-day discussion meeting organised in Ranchi (Jharkhand) on the issue of ‘changes in labour laws. Participants in the meeting asserted that under these new codes, many of the benefits and safeties accorded to labourers have been "taken away", while the right of labourers to create trade unions has been attacked.

Buddhist shrines were 'massively destroyed' by Brahmanical rulers: Historian DN Jha

Nalanda mahavihara 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".

Celebrating birthday amidst image of 'coerced, submissive' India ruled by a strong leader

Pushkar Raj*  As the weeks long birthday festivity of the leadership was being rejoiced India wide, the Covid was still raging in several parts of India. The carnival was in line with the post-Covid decisions and actions of the leadership demonstrating a pursuit of personal power and glory instead of national interest in times of disease and death.

Politically-motivated: Global NGO network on ED 'harassment' of Harsh Mander

Counterview Desk  CIVICUS , a top global alliance of civil society organisations seeking to strengthen citizen action and civil society around the world with a claimed membership of more than 10,000, objecting to the alleged harassment of IAS bureaucrat-turned-human rights activist Harsh Mander by the Government in India, has said that the the the Enforcement Directorate (ED) raid on his house and office highlights “an ongoing pattern of baseless and politically-motivated criminal charges brought by the authorities against activists across India”.