We need an action plan to deploy India’s demographic advantage

Source: The post is based on the article “We need an action plan to deploy India’s  demographic  advantage” published in Mint on 20^th April 2023.

Syllabus: GS 3 – Inclusive Growth

Relevance: concerns associated with inclusive growth and measures needed.

News: The issues in India which receive less attention are children education, skilling youth for better-quality jobs, and restoring the female labour force participation rate.

Why are these issues important?

They affect India’s ability to achieve desired growth. It has also been observed that the wage growth of listed companies has been increasing, despite low number of jobs created by them. This increases disparities.

Further, India’s Phillips Curve has steepened. This reflects a lack of adequate skilled labour and a lack of adequate upgrading of labour skills for the formal sector.

Due to this, India is creating too few jobs relative to the size of its labour force.

What are the other reasons that affect India’s growth?

Agriculture: There are many low-skilled labourers in agriculture. As per the World Bank, India’s agricultural labour force share was at 45% in 2020, despite the sector’s share in GDP is less than 20%.

Education: Educational gaps become hindrance to the development of high skilled labour. The educational gaps exist in spite of a steady improvement in school enrolments in India since 2006 and measures for educating the girl child.

Female labour participation rate: Pandemic has impacted India’s female labour participation. As per the data, it has declined from 18% in 2016 to 11% in 2022, and to under 7% in urban areas.

Even data from the Periodic Labour Force Survey (PLFS) shows that female labour force participation is low in an absolute sense and also relative to most peer countries.

What can be done to address these issues?

First, the proportion of low-wage agricultural work must be reduced and turned into higher-wage, better-skilled employment.

This can be done by – a) raising the sector’s presently subsidized costs of inputs to market prices, b) allow foreign entry into the sector and increase its productivity by lowering tariffs, c) reducing the number of agricultural labour by training the youth for vocational skills in manufacturing and services.

Second, the large primary education gaps created in children’s learning during the pandemic need to be decisively addressed.

This can be done by – a) delivering a grade-by-grade national curriculum for a 30-day remedial summer programme and another enriched 30-day start-of-the-year boot camp for reinforcement, b) ASER-style surveys could be conducted at pre-summer, end-of-summer and exit-of-boot-camp stages to assess success and identify remaining gaps, c) STEM education should be encouraged at secondary schooling levels in public schools, with screening based on entrance tests.

Third, it is necessary to make it easier for women to join and remain in the labour force, especially in urban areas.

This can be done by utilizing Corporate Social Responsibility of the companies to – a) Support for entities that provide education to the girl child and skilling to the young female population; b) maternity leaves and primary caregiver relief for spouses will provide the flexibility for mothers in resuming work; and, c) setting up of quality childcare facilities in company premises or neighborhoods to reduce the domestic burdens of working women.