Unemployment, the elephant in the room

Unemployment, the elephant in the room

India's working age population stands at about 90 crore at present. (Image for representation)

Yet another report on India's large and growing unemployment is now in the public domain. The ‘State of Working India Report 2019’, released by the Bangalore-based Azim Premji University, says that as many as 50 lakh men lost jobs between 2016 and 2018.

Although the report has been out for more than 24 hours the government – which has acquired a reputation for quickly reacting to and disowning such findings – has not disputed the report. Perhaps the figure is not astronomical enough. After all, India's working age population stands at about 90 crore at present.

The report also lays bare the fact that India's overall unemployment rate, at around six per cent, is double of what it was between 2000 to 2011. This should have raised an alarm in the ruling establishment, but perhaps the government is inured to such findings and has finally decided that silence is the best policy on a front it has grossly failed.

Only in February 2019, the National Sample Survey Office’s (NSSO) leaked jobs survey had drawn attention to how half of India’s working-age population (over 15 years) was not contributing to any economic activity. It said the labour force participation rate (LFPR) – the proportion of a country’s working-age population that engages actively in the labour market – stood at 49.8 per cent in 2017-18, falling sharply from 55.9 per cent in 2011-12.

The report created a furore. The government asked its policy think tank, Niti Aayog, to dispute the findings and establish that it was far from the truth. Niti Aayog’s vice chairman, Rajiv Kumar, not only did so, but also promised an all-new survey report by the end of March 2019. There is no trace of it till date. Neither has this promised report been widely reported nor has anybody questioned the delay. Not even the Opposition. Maybe, it has been forgotten in the heat and dust of elections.

It should strike observers as somewhat strange, if not outright illogical that the Opposition is unable to turn joblessness, a big concern for large sections of voters, into an effective election plank.

Perhaps the answer to this conundrum has to do with how we have dealt with the issue in the past. Traditionally, poverty has been the fulcrum around which India's politics has revolved, not unemployment. Therefore, election after election has been fought over poverty or ‘garibi’. Unemployment has never been as important for Indian politicians. This is evident even seven decades after Independence: India still does not have credible jobs data.

Although the past few months have seen much politics over the country's jobs data and confusions galore, the fact remains that in the cacophony of Hindutva and caste identity, jobs have not been given their due by political parties.

There is some amount of attention to the employment scenario from the Congress, but the Bharatiya Janata Party (BJP) has not been doing anything other than reacting to Congress' allegations about the extent of joblessness.

The ruling party’s manifesto is conspicuously silent on how it will deal with massive joblessness and job losses. Its narrative has changed from developing labour-intensive sectors to generating more employment to increasing investments by leaps and bounds in various sectors – as though India's job creation has been held back only due to a lack of funds.

To illustrate, the BJP's 2014 Lok Sabha polls manifesto promised to develop high-impact domains like labour-intensive manufacturing and tourism. It also promised that it would transform employment exchanges into career counselling centres!

Five years later, the party's 2019 manifesto makes no mention of any of these bright ideas. It now promises a whopping Rs100 lakh crore expenditure in the infrastructure sector as a means of creating jobs and facilitating more money flow into other sectors.

However, the issue goes beyond which party is in power. The Indian government’s lack of proper jobs data has given rise to several autonomous and private bodies coming up with their unemployment estimates and surveys.

Apart from the household jobs expectation survey from the Reserve Bank of India, India has others from the Centre for Monitoring Indian Economy or CMIE; reports of the Azim Premji University; data from the Employees’ Provident Fund Organisation or EPFO and that from the Confederation of Indian Industry or CII. In addition, is also the data from NSSO.

And many of them whether or not they have been censored, seem to pointing to a problem that cannot be ignored: India has a massive jobs problem.

The latest report by the Azim Premji University has said that the rate of open unemployment has steadily risen over the past few years. Besides, unemployment among the educated youth has reached 20 per cent. Unemployment in urban areas, at 7.8 per cent, is higher than the unemployment rate in rural areas at 5.3 per cent. In addition to this, Indian towns and cities continue to be plagued by the prevalence of low-wage, poor quality, informal work.

On formal jobs, the problem begins at the bottom of the pyramid with India's education system. As per the 2018 World Development Report, almost 90 per cent of Class II students in rural India could not read a single word of a short text and more than 80 per cent failed to perform a basic two-digit subtraction.

Nepal, despite its lower per capita GDP and a similar education spend to GDP ratio as India, achieved far better learning outcomes. Countries in sub-Saharan Africa too have shown better learning outcomes. India spends a meagre five to six per cent of its GDP on education.

In 2014, the BJP’s prime ministerial incumbent, Narendra Modi, had promised to create two crore jobs a year. However, at the end of his five years as PM, many, many jobs have gone missing from India along with even the existing jobs data.

India is battling a big unemployment problem that has not been addressed by different political dispensations. The question is, is this the election when unemployment will finally become a legitimate election issue or will India continue to grapple with multiple sources of data all pointing to the elephant in the room that nobody knows what to do about.