<p>Imagine spending the best years of your life from age 22 to 29, in a waiting room. You are educated, ambitious, and capable. But the job you are waiting for has odds worse than a lottery. So, you study harder, make another attempt, and wait again. Meanwhile, your peers are earning, saving, climbing career ladders, getting married, and starting families. You are doing none of that. You are preparing for the next exam.</p>.<p>This is the lived reality for an estimated 11 million young graduates in India today. The fifth edition of the State of Working India report, published this month by Azim Premji University, reveals a startling statistic: 67% of all unemployed youth aged 20-29 are graduates, that is 1.1 crore people. In 2004, graduates constituted just 32% of the unemployed youth cohort. Their share in the youth population has itself risen from 10% to 28% over these two decades. But employment has not kept pace. Between 2004 and 2023, India produced roughly 50 lakh graduates every year. Only 28 lakh graduates found any employment annually, <br>and a mere 17 lakh entered salaried work. The arithmetic of national waste is stark.</p>.<p>The overall unemployment rate among all graduates aged 22-29 runs as high as 33%. This rate drops to below 4% after age 30. What happens around age 30 is not success. It is resignation. Young men eventually succumb to economic pressure, marriage obligations, or parental urgency and accept whatever work is available. Young women, by contrast, often exit the labour force altogether, retreating into unpaid domestic care work. The data shows this starkly: male unemployment falls because men find some job; female unemployment falls because women stop looking.</p>.<p>Why do millions of graduates spend their prime years in this limbo? The answer lies in a rational calculation, which is ultimately socially ruinous. Starting salaries in the private sector have barely moved in two decades. In 2011, a young male graduate earned about Rs 21,800 a month. By 2023, this figure had fallen to Rs 19,573. That is a drastic drop, and when adjusted for inflation, it is disastrous. Government jobs is a different story. A government driver may earn four times his private sector counterpart. A government clerk enjoys health cover, a pension, job security, and social prestige. No wonder the aspiring graduate chooses to wait.</p>.<p>This wait takes a peculiar form: the endless preparation for competitive government examinations. A study by Kunal Mangal of Tamil Nadu Public Service Commission data found that one TNPSC Group 4 recruitment in 2018-19 drew 13.7 million applicants. About 80% of all unemployed individuals in Tamil Nadu were simultaneously preparing for a TNPSC exam. When the State imposed a partial hiring freeze between 2001 and 2006, vacancies fell by 86%, but exam applications rose by 7%. This pattern is seen across states. The government exam has become India’s great waiting room.</p>.<p>The private sector, meanwhile, offers a treadmill at the entry level, not a career. The Economic Survey 2024-25 noted that only 8.25% of graduates work in roles aligned with their qualifications. Nearly half are in jobs that require a degree for eligibility but deliver no skill development, no learning by doing, and no career progression. Between 2012 and 2019, India’s GDP grew at an annual rate of 6.7%, while employment grew by only 0.1%. Of the 83 million jobs added between 2021-22 and 2023-24, nearly half were in agriculture. Labour laws, rather than protecting workers, encouraged employers to substitute casual and contract labour for permanent employment.</p>.<p>The gender dimensions deserve special attention. PLFS data confirm that educated women in their early 20s report high unemployment, signalling a genuine desire to work. But by their late 20s, instead of finding employment, they exit the labour force. Marriage expectations and the assumption that domestic care falls entirely on women extinguish participation. The waste is particularly stark in medicine: women constitute 51% of each incoming batch, yet only 17% of practising doctors are women. In rural areas, just 6%. Half the talent, trained at taxpayer expense, simply disappears.</p>.<p><strong>The subsidy fallout</strong></p>.<p>Now consider the perverse policy feedback loop. Governments, sympathetic to the plight of unemployed graduates, respond with cash transfer schemes and subsidised coaching for competitive exams. This fiscal expenditure, though well-intentioned, tightens the budget constraint, which, ironically, leaves the government with less room to hire. Vacant Central government posts more than doubled between 2014-15 and 2021-22, from 4.21 lakh to 9.64 lakh. The subsidy deepens the exam-lottery culture; the hiring freeze defeats the purpose. State governments that subsidise UPSC coaching are, in a sense, funding the lottery queue while letting the prize shrink.</p>.<p>The consequences for India’s reservation policy are painful. When recruitment slows, reserved posts go unfilled. SC employees in the Central government fell by 47% in absolute numbers between 2003 and 2021. When one generation gains a government post, the next generation climbs higher; that intergenerational ladder breaks when the post is never filled.</p>.<p>The policy prescription follows from the diagnosis. Reduce search frictions through better labour market information, job portals, and portable apprenticeship schemes that benefit both employers and workers. Fix skills mismatch through employer-driven, not certificate-driven, training. Critically, reduce the enormous premium on government employment through rationalised pay, fixed-term contracts, and wider staffing structures. Unemployment support must be conditioned on active job search, not passive waiting. And remove structural barriers that push women out of the workforce, with support like crèches, flexible work arrangements, and safety in commuting.</p>.<p>Eleven million educated young Indians are today squandering their most productive years in a lottery they will almost certainly lose. The waiting room has become a national institution. That is a waste of individual lives and of public investment in education. We cannot afford to let our demographic dividend rot in a coaching class or waiting room.</p>.<p><em><strong>The writer is an economist; Syndicate: The Billion Press</strong></em></p><p><em>(Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH.)</em></p>
<p>Imagine spending the best years of your life from age 22 to 29, in a waiting room. You are educated, ambitious, and capable. But the job you are waiting for has odds worse than a lottery. So, you study harder, make another attempt, and wait again. Meanwhile, your peers are earning, saving, climbing career ladders, getting married, and starting families. You are doing none of that. You are preparing for the next exam.</p>.<p>This is the lived reality for an estimated 11 million young graduates in India today. The fifth edition of the State of Working India report, published this month by Azim Premji University, reveals a startling statistic: 67% of all unemployed youth aged 20-29 are graduates, that is 1.1 crore people. In 2004, graduates constituted just 32% of the unemployed youth cohort. Their share in the youth population has itself risen from 10% to 28% over these two decades. But employment has not kept pace. Between 2004 and 2023, India produced roughly 50 lakh graduates every year. Only 28 lakh graduates found any employment annually, <br>and a mere 17 lakh entered salaried work. The arithmetic of national waste is stark.</p>.<p>The overall unemployment rate among all graduates aged 22-29 runs as high as 33%. This rate drops to below 4% after age 30. What happens around age 30 is not success. It is resignation. Young men eventually succumb to economic pressure, marriage obligations, or parental urgency and accept whatever work is available. Young women, by contrast, often exit the labour force altogether, retreating into unpaid domestic care work. The data shows this starkly: male unemployment falls because men find some job; female unemployment falls because women stop looking.</p>.<p>Why do millions of graduates spend their prime years in this limbo? The answer lies in a rational calculation, which is ultimately socially ruinous. Starting salaries in the private sector have barely moved in two decades. In 2011, a young male graduate earned about Rs 21,800 a month. By 2023, this figure had fallen to Rs 19,573. That is a drastic drop, and when adjusted for inflation, it is disastrous. Government jobs is a different story. A government driver may earn four times his private sector counterpart. A government clerk enjoys health cover, a pension, job security, and social prestige. No wonder the aspiring graduate chooses to wait.</p>.<p>This wait takes a peculiar form: the endless preparation for competitive government examinations. A study by Kunal Mangal of Tamil Nadu Public Service Commission data found that one TNPSC Group 4 recruitment in 2018-19 drew 13.7 million applicants. About 80% of all unemployed individuals in Tamil Nadu were simultaneously preparing for a TNPSC exam. When the State imposed a partial hiring freeze between 2001 and 2006, vacancies fell by 86%, but exam applications rose by 7%. This pattern is seen across states. The government exam has become India’s great waiting room.</p>.<p>The private sector, meanwhile, offers a treadmill at the entry level, not a career. The Economic Survey 2024-25 noted that only 8.25% of graduates work in roles aligned with their qualifications. Nearly half are in jobs that require a degree for eligibility but deliver no skill development, no learning by doing, and no career progression. Between 2012 and 2019, India’s GDP grew at an annual rate of 6.7%, while employment grew by only 0.1%. Of the 83 million jobs added between 2021-22 and 2023-24, nearly half were in agriculture. Labour laws, rather than protecting workers, encouraged employers to substitute casual and contract labour for permanent employment.</p>.<p>The gender dimensions deserve special attention. PLFS data confirm that educated women in their early 20s report high unemployment, signalling a genuine desire to work. But by their late 20s, instead of finding employment, they exit the labour force. Marriage expectations and the assumption that domestic care falls entirely on women extinguish participation. The waste is particularly stark in medicine: women constitute 51% of each incoming batch, yet only 17% of practising doctors are women. In rural areas, just 6%. Half the talent, trained at taxpayer expense, simply disappears.</p>.<p><strong>The subsidy fallout</strong></p>.<p>Now consider the perverse policy feedback loop. Governments, sympathetic to the plight of unemployed graduates, respond with cash transfer schemes and subsidised coaching for competitive exams. This fiscal expenditure, though well-intentioned, tightens the budget constraint, which, ironically, leaves the government with less room to hire. Vacant Central government posts more than doubled between 2014-15 and 2021-22, from 4.21 lakh to 9.64 lakh. The subsidy deepens the exam-lottery culture; the hiring freeze defeats the purpose. State governments that subsidise UPSC coaching are, in a sense, funding the lottery queue while letting the prize shrink.</p>.<p>The consequences for India’s reservation policy are painful. When recruitment slows, reserved posts go unfilled. SC employees in the Central government fell by 47% in absolute numbers between 2003 and 2021. When one generation gains a government post, the next generation climbs higher; that intergenerational ladder breaks when the post is never filled.</p>.<p>The policy prescription follows from the diagnosis. Reduce search frictions through better labour market information, job portals, and portable apprenticeship schemes that benefit both employers and workers. Fix skills mismatch through employer-driven, not certificate-driven, training. Critically, reduce the enormous premium on government employment through rationalised pay, fixed-term contracts, and wider staffing structures. Unemployment support must be conditioned on active job search, not passive waiting. And remove structural barriers that push women out of the workforce, with support like crèches, flexible work arrangements, and safety in commuting.</p>.<p>Eleven million educated young Indians are today squandering their most productive years in a lottery they will almost certainly lose. The waiting room has become a national institution. That is a waste of individual lives and of public investment in education. We cannot afford to let our demographic dividend rot in a coaching class or waiting room.</p>.<p><em><strong>The writer is an economist; Syndicate: The Billion Press</strong></em></p><p><em>(Disclaimer: The views expressed above are the author's own. They do not necessarily reflect the views of DH.)</em></p>
