5 million jobs lost between 2016-18, says report

Because export growth is slowing and the “pent-up” release of demand has a finite life, it is critical that capex continues to increase to facilitate economic employment, says the survey. Representational pic

Employment opportunities declined and five million men lost their jobs between 2016 and 2018, according to a report released by the city-based Azim Premji University.

The decline in job opportunities coincided with demonetisation in November 2016, although no direct causal relationship can be established based only on these trends, the State of Working India-2019 (SWI) report said.

Accounting for the increase in working-age population, the decline in the workforce participation rate (WPR) amounts to a net loss of 5 million jobs during this period (2016- 2018).

“Recall that this analysis applies to men only. When we take women into account, the number of jobs lost will be higher,” the report released on Tuesday (April 16) read. Underlining that the last three years were one of great turmoils in the Indian labour market as well as in the system of labour statistics, the report pointed out that unemployment rose steadily post 2011.

It found that the higher educated and the young were vastly over represented among the unemployed.

Consumer Pyramids Survey

It used data from the Consumer Pyramids Survey of the Centre for Monitoring the Indian Economy (CMIE-CPDX) to understand the employment situation between 2016 and 2018.

In addition to open unemployment among the educated, the less educated (and likely informal) have seen job losses and reduced work opportunities over this period. The report also found that women were worse off than men with respect to levels of unemployment as well as reduced labour force participation.

As a remedial measure, the report recommended the need for Urban Employment Guarantee Programme (UEGP) on the lines of rural employment guarantee scheme that can create employment opportunities for up to 50 million workers in small towns.

Besides UEGP, the SWI report has suggested three more recommendations. It emphasised on increasing the spending on education up to six per cent and on health up to 3% of the gross domestic product to create over two million good jobs while supplying high quality public services.

Underlining that employment generation and public service provisions should not be compromised for meeting arbitrary fiscal deficit targets, the report called for greater public spending in view of Indias fiscal situation.

It also highlighted the need for a concerted new industrial policy to revive Indian manufacturing. Releasing the report Amit Basole, associate professor at Azim Premji University and lead author of the report, said, “We are positive that our four policy proposals will spur job creation and improve the basic services in our country providing equitable job opportunities for all.”

The report is our ongoing effort to present well-researched data in the areas of job creation, employment, and sustainable livelihoods. The report analysed employment trends since 2016, which were not part of SWI 2018, the first report published in September 2018.