Facing the job problem

News: The government of Rajasthan has decided to introduce an urban job guarantee scheme similar to MGNREGA, which will offer 100 days of demand-based employment.

What are the concerns associated with the scheme?

State economy: First concern is whether 800cr  allocation will be enough for the open-ended program? Rajasthan’s government debt is already at 1/3rd of state GDP, as reported by CRISIL. So government move towards defined pension instead of defined contributions can be problematic.

Employment rate has not picked pace even in the informal sector. The periodic labor force survey revealed that the agricultural workforce has increased for the first time in decades. This is a worrying sign for the urban employment scenario. The parliamentary standing committee has called for a national urban guarantee scheme, but that was rejected by the central government.

Availability of work: The scheme will be more complex to implement as compared to MGNREGA. There are fewer locations for unskilled labor in the public sector in urban areas. Work may not be available in the neighborhood in which migrants reside.

Applicability: Who will be eligible for the scheme? Will migrants with an out-of-state domicile be able to benefit from state-based urban employment guarantee systems? Can employment rights be considered transferable across geographies? These questions need to be addressed.

Source: This post is based on the article “Facing the job problem” published in the Business Standard  on 25th February 2022.