Skip to main content

Not considered job-seekers? Indian data do not capture workers in informal sector

By Arjun Kumar, Ritika Gupta, Anshula Mehta, Sunidhi Agarwal, Sakshi Sharda, Mahima Kapoor* 

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 Impact and Policy Research Institute (IMPRI) and Centre for Development, Communication and Studies (CDECS), Jaipur organized a panel discussion on 'State of Development Discourses – #CohesiveDevelopment on How to Resolve Unemployment Problem in India'.
The discussion began with 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 MNREGA, corporate databases such as Naukri.com and LinkedIn, and Independent HR.
Looking at the trends in unemployment, certain features stand out:
  • In the decade 2008-19, the unemployment rate declined 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, AN Sinha Institute of Social Studies, Patna, and Advisor, CDECS, Jaipur, 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.
Prof Ray said it is necessary to explore as to 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.

Global integration

Prof Dev Nathan, Research Director, Gendev Centre for Research and Innovation, Gurugram, focused on manufacturing exports, which has high employment elasticity of output. Thus, in order to increase employment, the country must increase its share of manufacturing output. This can be achieved by integrating itself into Global Value Chains (GVCs).
So far, India has been participating in assembling products through the GVCs. Prof Nathan noted that these chains have maintained, despite the international border restrictions. China had taken advantage of these GVCs to emerge as a manufacturing hub in the world, and as a result, reduced poverty and increased employment.
However, with the rising wages, manufacturers have moved out of China but have not looked at India as an attractive alternative, limiting labour intensive exports. An inverted tariff structure, with higher tariffs for components and lower tariffs for finished products, contributes to this problem.
This problem can be ameliorated if low quality production, logistical bottlenecks, low share of synthetics in garment exports, inefficient labour systems dependent on contractual labour, physical and administrative infrastructure, and low research and development (R&D) and innovation are eliminated.

Political planning

Prof RB Bhagat, Head, Department of Migration & Urban Studies International Institute of Population Sciences (IIPS), explained that every second household in Bihar has a migrant worker, however along with Uttar Pradesh it contributes only one tenth to the GDP. According to him, it is important to note the states that act as destinations of accelerated GDP growth and taking into account the urban-rural divide.
Keeping in mind that agriculture employs 45% of the labour force, boosting jobs through boosting production becomes important. Rural diversification combines agro processing, food processing, rural industrialization and services. The strategy of integrating the benefits of rural and urban through policy instead of rural versus urban is pertinent.
In light of this, planning has to be revived. Additionally, this planning at the national level has to be converged across the various departments of the government and at the local level. Unemployment is not just an economic issue, but a political one as well.

Rights-based approach

Dr Lenin Raghuvanshi, Founder and CEO, People’s Vigilance Committee on Human Rights (PVCHR), an initiative of Jan Mitra Nyas, Varanasi, highlighted the importance of equal opportunity to work. He talked about his work in Musahar ghettos in improving their knowledge, attitudes and practice (KAC) and production.
The concept of village republics has to be brought to the centre stage in order to provide dignity and opportunities to the farmers in the villages, that they get in the big cities. Training of the youth and passing on the share of profits as part of democratic capitalism gave economic freedom to them to pursue these opportunities.
Dr Chandra Sekhar Shrimali, Educator and Career Counsellor, Member, Board of Management, Maharaja Ganga Singh University, Bikaner, highlighted that a major concern is that the youth of the nation, while choosing field of education and subsequently work, do not map out their goals. In addition to this, the practical aspects of modules at high school or undergraduate levels are left out, creating a gap between leaning and its application. According to him, relevant diplomas should me made compulsory to augment the skill sets.
Sonia George, Secretary, Self-Employed Women’s Association (SEWA), Kerala, called for rethinking the definition of unemployment. The binary concepts of employment and unemployment do not seem to work when we consider that most people employed in the informal sector are not considered to be ‘job-seekers’ -- for example, services, frontline and home-based workers.
National Rural Livelihood Mission, National Urban Livelihood Mission and other government programmes are based on the concept of building self-help groups for credit and skill. She questioned the ability and sustainability of these methods to generate jobs and enterprises.
Unpaid labour of women has largely subsidized the economy. In addition to this, the care economy also remains undocumented. Establishment of these jobs and strengthening social security are some solutions. Incorporation of these in the formalization process and consideration as a source for employment generation is the way forward.

Career planning

Dr Upendra Singh, Director, CDECS, Jaipur, directed the focus of the situation to the micro-level. The working-age population should get the appropriate jobs matching their skill set and remuneration. This stems from the fact that there is a mismatch between a person’s knowledge and skills and the job they are aiming for.
There is a push and pull effect of demand and supply of labour in the market. The market, political system, and administration can be called the fulcrum which is determining the stability of the same. The focus should then be in identifying the sectors or states that are generating demand for labour and the type of opportunities they provide.
To mitigate the problem, Dr Singh suggested counselling systems, starting from high school, across the country. Stirring dedication and devotion, especially among the people who have been struggling to find opportunities, is imperative. Further, skill impartment should be through hands-on training. To this, Prof Ray emphasised the concept of collective entrepreneurship, which are missing in India, to strengthen the indigenous production process and reduce dependency on imports.

Way forward

  • Creation of models through economic democracy for equal rights of the labour
  • Development and institutional and capacity building starting at the local level
  • Convergence of goals and practical skills and knowledge
  • Recognizing the role of undocumented work and integrating it with economic growth for inclusivity and acceleration of jobs
---
*Researchers at IMPRI. Acknowledgement: Ramya Kathyal and Ria Mohal, Research Intern at IMPRI

Comments

TRENDING

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.

How lead petitioner was rendered homeless when GM mustard matter came up in SC

By Rosamma Thomas*  On January 5, 2023, the Supreme Court stayed a December 20, 2022 direction of the Uttarakhand High Court to the Indian Railways and the district administration of Haldwani to use paramilitary forces to evict thousands of poor families occupying land that belonged to the railways.  Justice AS Oka remarked that it was not right to order the bringing in of paramilitary forces. The SC held that even those who had no rights, but were living there for years, needed to be rehabilitated. On December 21, 2022, just as she was getting ready to celebrate Christmas, researcher Aruna Rodrigues was abruptly evicted from her home in Mhow Cantonment, Madhya Pradesh – no eviction notice was served, and nearly 30 Indian Army soldiers bearing arms were part of the eviction process. What is noteworthy in this case is that the records establishing possession of the house date back to 1892 – the title deed with the name of Dr VP Cardoza, Rodrigues’ great grandfather, is dated November 14

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".

Savarkar 'criminally betrayed' Netaji and his INA by siding with the British rulers

By Shamsul Islam* RSS-BJP rulers of India have been trying to show off as great fans of Netaji. But Indians must know what role ideological parents of today's RSS/BJP played against Netaji and Indian National Army (INA). The Hindu Mahasabha and RSS which always had prominent lawyers on their rolls made no attempt to defend the INA accused at Red Fort trials.

Tax buoyancy claims when less than 4% Indian dollar millionaires pay income tax

By Prasanna Mohanty  In FY18, the last year for which disaggregated income tax data is available, only 29,002 ITRs declared income above Rs 5 crore, while Credit Suisse said India had 7.25 lakh dollar millionaires (the wealth equivalent of Rs 8 crore and above) that year. Often enough, the Centre claims that demonetization in 2016 raised tax collections, improved tax efficiency, and expanded the tax base. Now RBI Monetary Policy Committee (MPC) member Ashima Goyal has also joined their ranks, attributing the “claims” of rising tax collections in the current fiscal year to “tax buoyancy” brought by the demonetisation . Do such claims have any basis in official records? The answer is unequivocal. The budget documents show the tax-to-GDP ratio (direct plus indirect tax) increased from 10.6% in FY16 (pre-demonetization) to 11.2% in FY17, remained there in FY18 (demonetization and GST fiscals), and then fell to 9.9% in FY20. In FY22, it improved to 10.8% and is estimated to drop to 10.7% in

Gandhian unease at Mahadev Desai book launch: Sabarmati Ashram may lose free space

By Rajiv Shah  A simmering apprehension has gripped the Gandhians who continue to be trustees of the Sabarmati Ashram: the “limited freedom” to express one’s views under the Modi dispensation still available at the place which Mahatma Gandhi made his home from 1917 to 1930 may soon be taken away. Also known as Harijan Ashram, a meeting held for introducing yet-to-be-released book, “Mahadev Desai: Mahatma Gandhi's Frontline Reporter”, saw speaker and after speaker point towards “narrowing space” in Gujarat for Gandhians (as also others) to express themselves. Penned by veteran journalist Nachiketa Desai, grandson of Mahadev Desai, while the book was planned to be released on January 1 and the meeting saw several prominent personalities, including actor-director Nandita Das, her scholar-mother Varsha Das, British House of Lords member Bhikhu Parekh, among others, speak glowingly about the effort put in for bringing out the book, exchanges between speakers suggested it should be rele

Civil rights leaders allege corporate loot of resources, suppression of democratic rights

By Our Representative  Civil rights activists have alleged, quoting top intelligence officers as also multiple international forensic reports, that recent developments with regard to the Bhima Koregaon and the Citizenship Amendment Act-National Register of Citizens (CAA-NRC) cases suggest, there was "no connection between the Elgaar Parishad event and the Bhima Koregaon violence." Activists of the Campaign Against State Repression (CASR) told a media event at the HKS Surjeet Bhawan, New Delhi, that, despite this, several political prisoners continue to be behind bars on being accused under the anti-terror the draconian Unlawful Activities (Prevention) Act. Addressed by family members of the political prisoners, academics, as well as social activists, it was highlighted how cases were sought to be fabricated against progressive individuals, democratic activists and intellectuals, who spoke out against "corporate loot of Indian resources, suppression of basic democratic

Kerala natural rubber producers 'squeezed', attend to their plight: Govt of India told

By Rosamma Thomas   Babu Joseph, general secretary of the National Federation of Rubber Producers Societies (NFRPS) at a recent discussion at Mahatma Gandhi University, Kottayam, explained that it is high time the Union government paid greater heed to the troubles plaguing the rubber production sector in India – rubber is a strategic product, important for the military establishment and for industry, since natural rubber is still used in the manufacture of tyres for large vehicles and aeroplanes. Synthetic rubber is now quite widespread, but styrene, which is used in making synthetic rubber and plastics, and also butadiene, another major constituent of synthetic rubber, are both hazardous. Prolonged exposure to these even in recycled rubber can cause neurological damage. Kerala produces the bulk of India’s natural rubber. In 2019-20, Kerala’s share in the national production of rubber was over 74%. Over 20% of the gross cropped area in the state is under rubber cultivation, with total

Cyrus Mistry, PM Modi’s brother: What do these accidents have in common? Merc!

By Rosamma Thomas*  In September 2022, in an accident at Palghar near Mumbai, Cyrus Mistry, former chairman of the Tata Group, died in a road accident . On December 28, 2022, a road accident in Mysore left one of Prime Minister Narendra Modi’s brothers injured. What is common in these accidents? The car that crashed into the divider on the road, in both these cases, was manufactured by “prestigious” German manufacturer Mercedes Benz. One former dealer of Mercedes Benz cars in India has been raising issues of the threat to the lives of those riding these cars for many years now. Cama Motors, among the oldest dealers of foreign cars, having started business in pre-independence India, noted over 10 years ago that Mercedes Benz was indulging in corrupt practices . The cars are currently priced between Rs 41 lakh and Rs 2.92 crore in India; few people realize that the pride of owning a Merc comes at considerable risk to life. Cama Motors carefully documented several of the flaws on a websi

Bangladesh 'rights violations': US softens stance, fears increased clout of China, India

By Tilottama Rani Charulata*  In December 2021, in addition to the Rapid Action Battalion (RAB), the United States imposed sanctions on seven former and current officers of the force, alleging serious human rights violations. Benazir Ahmed and former RAB-7 commander Miftah Uddin Ahmed were banned from entering the US. RAB as an institution was also canceled the support it was getting from the US and its allies. At the same time, those under the ban have been notified of confiscation of assets held abroad. The anti-crime and anti-terrorism unit of the Bangladesh Police, RAB is the elite force consisting of members of the Bangladesh Army, Bangladesh Police, Bangladesh Navy, Bangladesh Air Force, Border Guard Bangladesh, Bangladesh Civil Service and Bangladesh Ansar, and has been criticized by rights groups for its use of extrajudicial killings and is accused of forced disappearances. The government of Bangladesh has been insisting about lifting the ban on RAB, but the US had till recen