India Employment Report 2024

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Context:

• The India Employment Report 2024 has been released by the International Labour Organisation (ILO).

Employment Scenario in India - ILO Report

Grim Employment Landscape

• Unemployment Trends: Between 2000 and 2018, India experienced a worrying trend in its employment landscape, characterized by a deterioration in various key labor metrics.
• Youth Unemployment: Nearly 83% of the unemployed population in India comprises young individuals, highlighting a significant challenge in harnessing the potential of the country's youthful demographic.
• Educational Disparities: The proportion of unemployed youth with secondary or higher education nearly doubled from 35.2% in 2000 to 65.7% in 2022, indicating a mismatch between skills and job market demands.

Long-term Deterioration and Recent Improvements

• Labour Market Indicators: The Labour Force Participation Rate (LFPR), Worker Population Ratio (WPR), and Unemployment Rate (UR) exhibited a prolonged decline from 2000 to 2018, indicating systemic challenges within the labor market.
• Recent Trends: However, there has been a slight improvement observed after 2019, coinciding with periods of economic distress. This improvement, though noteworthy, raises questions about its sustainability and the underlying drivers.

Paradoxical Improvements

• Sectoral Imbalances: Despite the higher growth rate of non-farm employment compared to agriculture, the non-farm sectors have struggled to absorb workers adequately, perpetuating the issue of underemployment.
• Informal Sector Dominance: Informal employment remains pervasive, engaging approximately 90% of the workforce. However, the share of regular employment, which exhibited growth until 2018, has been on the decline thereafter.
• Contractualization: There has been a concerning rise in contractualization, with only a small percentage of regular workers benefitting from long-term contracts, contributing to increased job insecurity.

Skill Gap and Gender Disparities

• Skills Deficiency: A significant proportion of the youth lacks essential skills demanded by the job market. For instance, a considerable percentage struggles with basic computer tasks such as sending emails, copying files, and using spreadsheets.
• Gender Disparities: The labor market in India continues to grapple with substantial gender disparities, particularly evident in low rates of female labor force participation and high unemployment rates among highly educated women.
• Social Inequalities: Despite affirmative action measures, marginalized groups such as Scheduled Castes and Scheduled Tribes face persistent challenges in accessing quality employment opportunities, leading to a perpetuation of social hierarchies.

PRACTICE QUESTION Q. Examine the underlying factors contributing to persistently high rates of unemployment, particularly among the youth and highly educated individuals.  Propose comprehensive strategies to revitalize India's employment sector.