India still to produce adequate employment opportunities

By siliconindia   |   Monday, 27 September 2010, 15:34 IST   |    1 Comments
Printer Print Email Email
India still to produce adequate employment opportunities
Bangalore: India's GDP growth might have recovered from the global crisis, but the question still remains whether there are adequate employment opportunities or not. According to the Economist, India had a joblessness rate of 10.7 percent in 2009, reports N Chandra Mohan of Rediff.com. But as per the latest official number on the rate of unemployment, it is eight percent on a daily status basis in 2007-08. Unlike advanced countries where up-to-date information is available on labour market behaviour, this information is available in India only with a five-year lag. The last comprehensive survey of the National Sample Survey Organisation (NSSO) pertains to 2004-05. The next survey for 2009-10 has just been completed and the results will be published in 2011. The ministry of labour and employment, however, has so far conducted six successive quarterly surveys on the effect of the global slowdown between October-December 2008 and January-March 2010. These surveys indicate that there has been a net addition of 850,000 jobs in a sample of firms in industries like textiles including apparels, leather, metals, automobiles, gems and jewellery, transport and IT/BPO. The earlier quarters -- October-December 2008 and April-June 2009 show a net decline in employment but there has been a turnaround since then. However, the fact that two-thirds of such employment has been generated only in IT/BPO sector while it is shrinking in labour-intensive sectors like textiles hardly indicates any broad-based upswing in overall job creation. Given the unavailability of NSSO's latest 2009-10 data, the Annual Report to the People on Employment from the ministry of labour perforce has had to make projections from the 2004-05 survey for making estimates of the labour force for 2009-10 and thereafter. However, researchers are unlikely to be enthused by the report's findings as the unemployment rate derived from that estimate for 2009-10 is only a lowly 2.7 percent on a usual status basis as it includes persons who are out of work and are seeking or available for work over a year. Longer-term unemployment rates are unlikely to capture the impact of the global crisis on GDP growth in India and the resultant spike upwards in joblessness. They remain low because in a country with pervasive poverty few can afford to remain unemployed for long stretches of time. They are forced to take up self-employment or casual odd jobbing in the unorganised sector than be without work. Unemployment rates on a daily status basis that capture those seeking/available for work on a typical day in the year are certainly a better indicator than the usual status one. Like the ministry of labour's report, one can extrapolate from earlier NSSO five-year surveys to derive more recent estimates, especially after the global crisis hit India.