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Source: The post on youth unemployment has been created based on the article “Are graduates facing unemployment?” published in “The Hindu” on 27th December 2023.
UPSC Syllabus Topic: GS Paper2- Governance- Issues relating to development and management of Social Sector/Services relating to Human Resources,
News: The article discusses the persistent issue of high unemployment rates among young, educated people in India, despite overall falling unemployment rates. It highlights that while fewer people are unemployed now, the problem remains severe for educated youth, reflecting a long-standing issue in the Indian economy.
What is the current unemployment situation?
Overall unemployment rate: According to periodic labour force survey, the overall unemployment rate in India has decreased from 6.1% in 2017-18 to 3.2% in 2022-23.
Educated youth unemployment: Young graduates, specifically those aged 18-29, face a high unemployment rate of 27% as of 2022-23. This indicates a persistent challenge for this demographic despite overall improvements.
Graduate unemployment trends: For all individuals with graduate degrees, unemployment has seen fluctuations but shows a decreasing trend; it peaked at 17% in 2017-18 and reduced to 13% in 2022-23.
Growing graduate workforce: The share of graduates in the labor force has increased, now making up around 15% by 2022-23.
Why is youth unemployment a concern?
Underutilized Human Capital: Such high unemployment rates among young, educated individuals suggest a significant underutilization of skilled human capital, which is detrimental to economic growth and productivity.
Growing Share of Graduates: The increasing share of graduates in the labor force, from 5% in 1993-94 to around 15% in 2022-23, highlights the expanding pool of educated yet unemployed youth, exacerbating the unemployment issue despite overall improvements.
Structural Issue: The problem has been longstanding since the 1990s, with unemployment among graduates peaking at 17% in 2017-18, showcasing it as a structural issue rather than a temporary fluctuation.
Way forward
Efforts to align education with market demands and enhance relevant skill development are crucial to address the 27% unemployment among young graduates. Creating more job opportunities in sectors that absorb educated youth will also mitigate high unemployment rates. Strengthening the education-employment linkage is key to utilizing the growing educated workforce effectively.
Question for practice:
Discuss how the trend of unemployment rates among educated youth in India reflects the broader economic challenges and what strategies might be employed to address this issue?
