[Answered] In the light of the present circumstances, the government should re-establish its role as the principal employment generator. Elaborate.

A serious situation of employment generation in India is reflected in the recurrent protests against changes in the government’s recruitment policy or delays in appointment. The Periodic Labour Force Survey (PLFS) in 2018 revealed that India’s unemployment rate was the highest (6.07%) in four decades. This situation demands that the government has to change its approach and become the main job generator, instead of the private sector.

The following points make it clear that government should be principal employment generator:

• The private sector, especially modern sectors such as the service and manufacturing sectors, which are dominated by multinational companies, have not created many jobs.
• Even if the Information Technology sector or the modern gig economies have created jobs, these are either very high-skilled jobs or low-skilled ones.
• The manufacturing sector’s share in national income has declined in 2020-21 (10.9%) compared to that in 2018-19 (12.1%).
• Projects in the modern private sector consume a lot of capital to generate very few jobs. For instance, recently, there was a report that the Adani Group has invested ₹70,000 crore (or ₹700 million) in Uttar Pradesh to create merely 30,000 jobs.
• Foreign Direct Investment, which at any rate is highly capital-intensive, goes mostly into the non-manufacturing sectors.
• Sustained higher growth with an increase in productivity can be attained only by moving the labour force out of agriculture. Which is not happening at a sufficient pace.
• Few media reports show that more than 85% of those aspiring for those 10 lakh jobs could be consumed by existing vacancies in Central government departments (8,72,243).

Way forward:

• Labour laws should be amended to encourage industries to adopt labour-intensive production and provide employment-linked production incentives.