Where are the jobseekers? Modi’s re-election bid rides on the answer

Data suggests that India’s unemployed youngsters are not looking for jobs. In January 2017, there were 408.4 million employed people in the country. The number of those who were unemployed and seeking jobs was 25.9 million. Seven months later, by the end of July, the number of employed fell to 405.4 million. But the number of those looking for jobs also fell to 13.7 million, according to a report by Centre for Monitoring Indian Economy (CMIE). Why did the unemployed, most of them young, stop looking for jobs? One reason could be they no longer want jobs and are turning entrepreneurs. The government has launched several schemes to promote entrepreneurship. Maybe, the youth increasingly prefer to be their own bosses. Another reason could be they want to study further as latest skills are valued in the market these days. In developed countries, people re-skill themselves during economic slowdowns. It could be a similar phenomenon in India. If they are neither turning entrepreneurs nor enrolling for higher education, what could they be up to? They could actually be doing nothing, which can be a disturbing trend if true, given India’s huge youth population. Before sweeping to power in the biggest election win in 30 years, Modi appealed to young job-seekers — more than half of the population — with a promise to create 10 million jobs. Three years later it remains unclear how many positions have been created. “The fall in the count of unemployed is concentrated in Uttar Pradesh, Bihar, Jharkhand and Odisha. These are the less developed states and these are also the states with the greatest bulge in young population. Such youngsters, who have no jobs and have even stopped looking for jobs could easily stray into unlawful activities. The demographic dividend can become a demographic demon,” says Mahesh Vyas, the CEO of CMIE. Vyas says this issue needs to be probed further and requires rigorous research. Niti Aayog’s Bibek Debroy fears voluntary unemployment could be a bigger headache for India in the coming years. “Intuitively we know about this (voluntary unemployment). Whether this is girls getting enrolled in schools, children getting enrolled in schools, income levels going up and women opting out, whether it is poorer households investing in education, and therefore not willing to engage in traditional pursuits and more, we intuitively know all this,” he was quoted by Quartz in a report. While India is one of the world’s fastest-growing economies, employment creation in eight sectors, including textiles and automobiles, was the slowest in seven years, according to a 2016 Ministry of Labour report. More than 12 million Indians enter the workforce every year, government data show. Between 2011 to 2015, the number of agricultural jobs reduced by 26 million while non-farm ones rose 33 million, according to McKinsey Global Institute. The Centre is now conducting its most ambitious jobs survey to date will reveal annual employment numbers for the whole country and quarterly estimates for its growing cities. The answer could shape Prime Minister Narendra Modi’s re-election bid in 2019.
Source: ET