India’s urgent need for good-quality jobs

Source: The post India’s urgent need for good-quality jobs has been created, based on the article “Welfarism is not the solution for India’s job problem, skill creation is” published in “Indian express” on 9th July 2024

UPSC Syllabus Topic: GS Paper3- Economy -employment

Context: The article discusses India’s urgent need for good-quality jobs. It highlights joblessness as a key issue, despite economic growth. The article suggests various policies, including vocational training, wage subsidies, technical assistance for enterprises, and basic income supplements for the poor.

For detailed information on Employment status in India read this article here

Why is joblessness a critical issue in India?

1. Persistent Problem Across Decades: Joblessness has been a consistent issue in India, not adequately addressed by successive governments, indicating its deep-rooted nature in the economy.
2. Election Concerns: Recent elections highlighted joblessness as a critical issue, affecting voter decisions and showing public dissatisfaction with existing job policies.
3. Economic Growth Disparity: Despite economic growth, employment has not kept pace. National surveys over 50 years confirm that job creation lags behind economic expansion, highlighting the failure to convert economic gains into employment opportunities.
4. Social Stability Risk: If unaddressed, the growing joblessness is potentially socially explosive, demanding immediate and focused policy intervention.

What are the issues with previous employment policies?

1. Delayed Payments and Shortcomings: There are notable delays in wage payments. Additionally, despite the law stipulating 100 days of work per household, many receive much less, undermining the effectiveness of the scheme.
2. Conditions of Manual Labor: The jobs provided are manual and performed in harsh conditions, such as under a scorching sun, making them less appealing and barely sustainable for workers.
3. Unmet Legal Guarantees: Workers rarely receive unemployment benefits when a job is not provided within 15 days, a failure to comply with the legal provisions of the schemes.

How can sustainable jobs be created in India?

1. Vocational Education and Training: Launch mass-scale vocational programs with business apprenticeships to improve employability, learning from models like Germany’s vocational system and the California community college system.
2. Adjusting Subsidies: Evaluate existing capital subsidies that currently encourage labor-replacing, capital-intensive investments. Replace some of these subsidies with wage subsidies that encourage firms to create regular jobs.
3. Support for Non-Farm Enterprises: Extend technical assistance and management training to non-farm household enterprises, drawing lessons from the software aid provided to ASHA workers in Uttar Pradesh.
4. Addressing Demand Deficiency: Address income inequality to boost consumer demand by raising incomes of lower economic sections through a basic income supplement, enabling them to participate more in the economy and potentially seek better jobs.
5. Tax Reforms: Fund these initiatives by reducing subsidies for the affluent and increasing taxation on the wealthy, including inheritance and wealth taxes.

Question for practice:

Discuss the reasons why joblessness remains a critical issue in India despite economic growth, and the proposed measures to create sustainable jobs.