Jobless Growth Becomes More Systemic

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By Moderator July 12, 2019 13:17

Article

K.P. Kannan, former Director, Centre for Development Studies expressed his views on recent Periodic Labour Force Survey data. Read this article to know more about Jobless Growth Becomes More Systemic.

Important Analysis

  • The findings of the latest employment survey called the Periodic Labour Force Survey (2017-18), are a cause for concern as the scenario is still far from anything that would denote decent employment.
  • The two biggest issues here are:
    • The shrinking share of the labor force; and
      • The labor force participation rate (% of people working or seeking work in the above-15 year’s age category) in the earlier survey of 2012 was 55.5%.
        • This has shrunk to 49.7% in 2018.
        • There is an absolute decline in the number of workers from 467.7 million in 2012 to 461.5 million in 2018.
      • The rising unemployment.
        • The figure for the overall unemployment rate at 6.1% is 2.77 times the same figure for 2012.

Key Findings

  1. On Unemployment
  • The rise in overall jobless growth has both locational and gender dimensions.
  • The highest unemployment rate of a severe nature was among the urban women at 10.8%; followed by urban men at 7.1%; rural men at 5.8%; and rural women at 3.8%.
    • When we ignore the location of residence, we find that severe unemployment among men at 6.2% was higher than among women at 5.7%.
    • youth unemployment rate (unemployment among those in the 15-29 years age category) has reached a high 17.8%.
  1. On women’s labor force participation rate
  • Given the sharp decline in women’s labor force participation rate, they have been losing out heavily due to the double whammy of exclusion from the labor force and an inability to access employment when included in the labor force.
    • The decline in women’s labor force participation from 31% to 24% means that India is among the countries with the lowest participation of women in the labor force.
  • Unemployment among women in the 15-29 years age category reached 27.2% which is more than double the 2012 figure of 13.1%. The rate for urban men, at 18.7%, is particularly high as well.
  1. On educated Unemployment
  • The issue of educated unemployment, given its link with not just growth but also with transformative development, has never been as acute as at present.
  • The unemployment rates go up as levels of education go up
    • Defined as unemployment among those with at least a secondary school certificate, it is at 11.4% compared to the previous survey’s figure of 4.9%.
    • Among those with secondary school education, it is 5.7% but jumps to 10.3% when those with higher secondary-level education are considered.
    • The highest rate is among the diploma and certificate holders (19.8%); followed by graduates (17.2); and postgraduates (14.6%).
    • Among the educated, women face a more unfavorable situation than men despite a low labor force participation rate.
      • Rate of unemployment among educated urban women (19.8%) followed by rural women (17.3%), rural men (10.5%) and urban men (9.2%).
      • Compared to the earlier 2012 survey, unemployment of educated men has more than doubled in both rural and urban areas and in the case of women, the rate has nearly doubled.
    • Author comment that although, educated persons are likely to have aspirations for specific jobs and hence likely to go through a long waiting period than their less-educated counterparts. They are also likely to be less economically deprived.
      • But the country’s inability to absorb the educated into gainful employment is indeed an economic loss and a demoralizing experience both for the unemployed and those enthusiastically enrolling themselves for higher education.

On Data

  • A few experts have raised doubts about the comparability of estimates between the two periods
    • Author comment that recent attempts by some to create an impression that self-employment has not been captured by the National Sample Survey are absolutely false since the definition of ‘employment’ includes in itself ‘self-’ as well as ‘wage employment’.
      • Within the category of ‘self-employed’, the survey also counts those engaged in ‘unpaid family labor’.

Conclusion

The overall conclusion here is that the trend of ‘jobless growth’ that was till recently confined largely, if not only, to the organized sector has now spread to other sectors of the economy, making it more generalized. This calls for a thorough re-examination of the missing linkages between growth and employment.

Source:

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Moderator
By Moderator July 12, 2019 13:17