Employment chimera

Employment chimera

Political parties know that the public memory is short and therefore make full employment promise before every election.

The Congress party is again promising 100 million jobs in ten years if voted to power in 2014 elections. Its main rival, BJP, is not unlikely to make a similar promise. Yes, the NDA and the UPA did promise the same thing – 100 million jobs -- before the last elections and on the eve of the earlier ones; the governments changed but the essence of promises remained the same. The major political parties, the governments and their agencies have been repeatedly harping on providing these
many jobs.

 Recall the NDA’s poll manifesto, of 2004. It said, “In the NDA’s common manifesto in 1999, we had promised to create one crore additional employment and self-employment opportunities each year. This commitment shall continue.” And look at the national manufacturing policy of the UPA government announced in end 2011. It aimed, among other things, at the same thing, creating 100 million jobs over a ten years period.

The country’s Five Year Plans, too, never tired of targeting at the full employment in the country. The eleventh Plan, for instance, projected the creation of 58 million jobs during the plan period. The tenth Plan’s employment goal was, “… giving a total of 50 million person years of employment opportunities over the Tenth Plan.” The ninth Plan asserted that every effort would need to be made in attaining the full employment even during the post-Plan period. It hoped the attainment of near full employment by 2007 might not be an unreasonable target provided the conditions were created for further acceleration in growth.

The eighth Plan also hoped that the envisaged GDP growth rate of 5.6 per cent would result in the employment growth of around 2.6 to 2.8 per cent per annum and yielding 9.5 million jobs per year thereby reducing the unemployment to a negligible level by 2002.

All the plans from were conscious of the need of full employment. But the empirical evidence suggests that the 63 years of planning could not banish the scourge of unemployment. The political parties know that the public memory is short and therefore make full employment promise before every election with great impunity. This author too played cassandra before and can’t help commenting again, as the same goal is being renewed umpteenth times.

Not that the political parties do not know that their policies did not yield results. Yet, they try to make the people believe that the full employment is possible and the economic growth is the prime mover for employment generation.

Impressive growth

The growth has been impressive as admitted by the government .Finance minister, Chidambaram claimed while presenting his recent interim budget that the GDP growth had been a high of 8.4 per cent during the first stint of the UPA and 6.6 per cent during the second term, both of them above the trend growth for 33 years of 6.2 per cent.
 If the growth has been really efficacious, it would have eliminated unemployment and poverty. But this did not happen. The official data and the reports themselves prove the point. Look at the twelfth plan document. It says, “the employment elasticity in India declined from 0.44 in the first half of the decade -1999–2000 to 2004–05 -to as low as 0.01 during second half, 2004–05 to 2009–10.” Employment elasticity roughly means change in employment in response to change in growth. So, one per cent increase in GDP is brining 0.01 per cent increase in employment – deteriorated from 0.44 per cent.

Although the 68th round of the NSS for 2011-12 prima facie shows a low unemployment rate - the overall rate on usual status of 3 per cent ( 2 per cent in rural areas and 4 per cent in urban areas) - in absolute terms the number of unemployed increased from 9.8 million by January 1, 2010 to 10.8 million by January 1, 2012. This figure is not small any way!

More importantly, the employment, even to the extent generated, is not of good quality meaning it doesn’t give incomes sufficient to lead a decent living to a majority of these job holders. As per the 12th  plan document, only 30.74 million out of total employment of 460.22 million are in the formal organised sector in 2009-10; fewer by 2.96 million compared to 1999-2000 level. Thus, the share of this good quality employment fell from 8.49 per cent to 6.68 per cent in the ten year period.

A further fall in the organised sector employment to 28.9 million is observable in the 2013 employment review of Director General of Employment and Training of the labour ministry. It may be added that the public sector part of the organised sector employment was only 17.5 million in 2011, lower than 19 million in 1991. Needless to mention the poor quality of employment in the informal sectors accounting for more than 93 per cent of the employment.

In conclusion, the unemployment is not very low as is made out to be, the quality of the bulk of employment is very poor – not capable of providing adequate means for a living. People do not want the empty promises – like 10 crore jobs assurance before every elections – nor any doles. What all they want are: provide quality education and health. Create employment opportunities to all the able bodied persons. Let there be a high growth but make the people partners of that growth in order to make them real beneficiaries of such growth.