Open Forum

New Delhi, 11 February 2014

Employment Scenario:

WILL 2014 WITNESS A REVIVAL?

By Dhurjati Mukherjee

The slowdown in the economy had a direct impact on employment opportunities in the last two years. With educated unemployment on the rise, this indeed has been a major problem in the country as educational accomplishments have not kept pace with employment opportunities. Presently the official unemployment rate is around 2.8 per cent but experts believe this to be over 3 per cent. However, measurement of employment is not an easy task as around 90 per cent of the work force is self employed or in the informal sector.

Recent surveys indicated that India’s slow GDP growth reaching below the six per cent mark resulted in new jobs opportunities slumping by around 18 to 20 in 2012 and 2013 compared to previous years. It needs to be mentioned here that employment generation is vital for the country’s economy but the present Government did not pay much attention to this aspect.

However, indications point out that in the current year the employment scenario is expected to witness a surge with the rebound in economic growth.  As per estimates of various human resources consultants, companies are gearing to add around 6 to 7 lakh employees, if not more, and dole out substantial pay hikes in tune with market prices. The banking sector is expected to hire aggressively as it has drawn ambitious hiring plans for officers as well as administrative staff. According to reliable sources, State-run banks are expected to recruit anything around 50,000-60,000 officers and clerical staff in the first few months of the current year.

Moreover with new banking licenses that are expected to be issued shortly, there would be more recruitment by those who get these licenses for opening branches. It may be mentioned here that the extent of demand for banking jobs is evident from fact that nearly 10 lakh candidates appeared in the written exams for 19,000 vacancies for officers in State-run banks!    

Other sectors that are likely to benefit from the steady economic recovery, in terms of jobs, include retail, IT/ITeS, pharmaceuticals and healthcare, hospitality and FMCG sectors. Apart from these, the other sectors likely to be involved in the process of hiring could be infrastructure, life sciences, media, education and entertainment.

Infosys, the country’s second biggest software exporter, plans to hire 15,000 engineers this year following improvement in demand in the US and other Western countries. It can also be expected that other such companies – both big and small – would continue hiring professionals. IT has now reached the villages and this development augurs well for spread of education, health care etc. and also, to a certain extent, in generating self employment.

The infrastructure sector is also likely to benefit in a big way as the UPA Government would try to start some of the stalled projects. Also the new government would follow similar lines and ensure that delayed infrastructure projects do not languish. There are expectations that demand for jobs will come from the industrial corridors that have been planned.     

The emphasis in the past few years of developing the physical infrastructure by construction of roads, extending power and telecom facilities may have had some impact in generating employment, including self-employment, but has not been adequate enough, considering the needs of the country. While physical infrastructure has to be focused on, the somewhat improved infrastructure should be utilized to motivate people to set up tiny and cottage industries as also agro-based industries – which have great potential -- through skilled training, on a professional level, and financial assistance through banks and financial institutions.    

Even as new technology and techniques of increasing productivity (both in the field and factory) tend to increase unemployment, there have been demands of according Constitutional guarantee of the right to work. Though the demand has not quite caught up obviously because only in the socialist countries the citizens have the right to work in the sense of right to employment but there are no unemployment benefits as an alternative.      

One may refer to a document prepared by the Union Ministry of Labour (way back in the 80s) which pointed out: “The overall approach to the concept of right to work has essentially to be that of creating conditions for the people to find productive work in the process of development ….  However, the inclusion of right to work as a fundamental right in the Constitution would make it incumbent to provide employment to the residuary categories of persons who will still be unemployed during the transition period”.          

Economists and planners feel that the primary reliance must be on the economic system to generate employment. As such, job generation has to be consciously built into the development strategy of any country. In India, for example, of the over 400 million working force, around 220-230 million continue to depend on agriculture for their living. As the last Economic Survey pointed out that the country has “to focus on an agenda to create jobs outside of agriculture, which will help us reap the demographic dividend and also improve livelihoods in agriculture”.

The big policy challenge ahead is the creation of more productive jobs by accelerating farm to non-farm activities and bringing down the share of agriculture in employment from around 52 per cent to say 42-45 per cent in the coming years. But if fewer jobs are created outside agriculture, more people will be forced to stay on in this sector, increasing the pressure on land and lowering incomes.

An important aspect that needs to be mentioned here is the need to bring about a revolution in food processing and horticulture to explore the potential of these sectors in economic revival and employment generation. If the development of agro-based industries is given special attention, this could change the face of Indian villages and generate employment opportunities. An integrated food law has to be brought in place instead of the multiple laws and regulations, which prescribed various standards and affected normal growth of the food processing industry. The whole employment strategy has to be based on revitalizing all segments of the rural sector, which had over the years been somewhat neglected.   

Apart from development of infrastructure, manufacturing and services must become the engine of employment growth. This would have a resultant effect and increase the purchasing power of the rural population which, in turn, would help the consumer goods and health care industry to expand in a big way and improve the living conditions of the people. ---INFA

(Copyright, India News and Feature Alliance)