Economics Current

Unemployment in India

Unemployment in India
Background A report released in September 2018 by the Centre for Sustainable Employment of the Azim Premji University stated that levels of unemployment have been steadily rising, and after several years of staying around 2-3%, the headline rate of unemployment reached 5% in 2015, with youth unemployment at 16%. According to the National Sample Survey Office (NSSO) report, the unemployment rate was at an all-time high of 6.1% in 2017-18. This rate of unemployment is the highest the country has seen in at least the last 20 years. The report, which was co-written by a group of researchers, policymakers, journalists and civil society activists, had used data from the National Sample Survey Office and the Employment-Unemployment Survey (EUS) of the Labour Bureau— which was last conducted in 2015-16. India had about 31 million unemployed people as of 2018. The report said- “It used to be said that India's problem is not unemployment but underemployment and low wages. But a new feature of the economy is a high rate of open unemployment, which is now over 5% overall, and a much higher 16% for the youth and the higher educated. The increase in unemployment is clearly visible all across India, but is particularly severe in the northern states.” An estimate of 58% of unemployed graduates and 62% of unemployed postgraduates have blamed the non-availability of jobs matching with education, expertise and experience as the main reason for unemployment in the country. According to the National Skill Development Mission Document, around 97% of the workforce in the country has not received any kind of formal skill training, and around 76% of the households did not benefit from employment generating schemes such as MGNREGA, PMEGP, SGSY, and so on. In January 2019, the central government announced that the labour bureau job report would be replaced by the National Sample Survey Office labour force survey. According to news reports, the most recent labour bureau job report had been approved in December 2018, but the publication of the same was withheld by the government. Later in January 2019, two of the four members of the National Statistical Commission resigned due to alleged suppression of employment survey data. The main causes of the rising rate of unemployment in India can be summarized as: •Farming has become unattractive due to the erratic nature of the monsoon and government policy. •With the introduction of GST, there has been an upheaval in the small and medium-sized enterprises (SME) which used to be a major absorber of labour, especially in rural areas. •Non-availability of jobs in accordance with education or skill level. •The unprecedented increase in population has resulted in lesser jobs being made available to a much bigger pool of people. Unemployment has, therefore, become one of the new major concerns of the policymakers and administrators.

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