India as a nation is faced with a massive problem of unemployment. Unemployment can be defined as the state of being without any work both for an educated and uneducated person, for earning one’s livelihood. Unemployment may be elaborated as a state of not finding work by an individual who is fit and willing to work. It is usually measured in percentage; the number of individuals without work out of the total “labour force” of the country or specific social groups.
Unemployment casts some short-term ripples throughout the economy by reducing an individual’s contribution in terms of services and taxes. The unemployed also does not possess purchasing power, thus in effect contributing to bringing down the demand for goods in the market and creating more unemployment. This vicious cycle creates a cascading effect throughout the economy and trickles down to different social strata. India currently has a population of about 1.25 billion. According to a recent United Nations Development Programme (UNDP) report, during the period of 1991 to 2013, the Indian economy has experienced maximum growth and yet less than half the number of Indians seeking jobs have managed to land one during this period. Statewise figures reveal that Tripura has the highest unemployment rate in the country at 19.7 percent while Gujarat has the lowest at 0.9 percent in 2015-16. On the other hand, the unemployment rate is higher among women at 8.7 percent versus 4.3 percent among men. Women unemployment rate is higher in the rural areas than in urban sectors of the country. Experts fear that at present, India is experiencing a jobless growth with not enough jobs being created for its working-age population (15-64 years). There is ample scepticism afloat about the country not being able to cash in on its demographic bonus, predicted to be 869 million by the year 2020—the world’s largest.
Our economy has grown and there has been development but not enough to generate a sufficient number of jobs. Another factor that has led to unemployment is the growth in population. Ours is a thickly populated country with the population increasing by leaps and bounds. But jobs and gainful avenues of employment cannot be generated in the same proportion. The jobs are restricted in number, but the people applying for them are many. So, a large section of people are left without a job.
The population of our country is ever-rising. The abnormal rise in population has intensified the problem of unemployment in India. That is why the issue of unemployment has been getting more and more acute every year. It is the responsibility of the State to provide work to the people. But the number of the unemployed persons in India is increasing at an alarming rate. More than one-third of the total population still lives below the poverty line. The number of registered unemployed, not to speak of those whose names are not in the register, is quite shocking. The number of job seekers also on the register of employment exchanges is increasing by leaps and bounds. There are three classes of employment here. In the villages, those people who live on agriculture work for four or five months in a year, idle away the rest of the time. During that period they practically remain unemployed. In the towns and cities, there is another class of unemployed people who find no employment in the factories due to the setting up of big machines there. Lastly, there are a large number of educated people who are unemployed. The masses, the uneducated and even the illiterate adopt some way or the other using which they can earn their living. The educated, however, cannot do this.
The problem of unemployment among the educated youth is a serious one. For every vacancy, there are dozens of applicants. Out of many candidates who are interviewed, only a few get the job. A student dedicates several years of his life to studies. It is a worrisome condition that even after getting Bachelors and Masters Degree, India’s youth is facing unemployment.
The root of the problem can be traced to a host of reasons that contribute collectively towards this problem.
1. Economic Growth without adequate Employment Opportunities: India’s GDP projections for the year
2017-18 is 7.5 percent but that growth does not currently translate into creating more employment opportunities for the labour force of the country. In a survey conducted among a sample of 1,072 companies across the nation and across various sectors, during the financial year 2014-15, only 12,760 jobs were created compared to 1,88,371 jobs in the year 2013-2014. In the year 2016, India’s rural unemployment rate stood at 7.15 percent whereas unemployment rate in urban areas stood at 9.62 percent.
2. Education: Although literacy rates have risen in the last few decades, there still remains a fundamental flaw in the education system in India. The curriculum is mostly theory-oriented and fails to provide vocational training required to match with the current economic environment. The degree-oriented system renders itself redundant when it comes to producing human resources adept at fitting into specific profiles within the economy.
3. Population Growth: Rapid growth of population has often been labelled as the major reason for increasing unemployment in the country. In the last ten years (2006-2016), India’s population has increased by 136.28 million
and unemployment was at a five-year high in the financial year of 2015-16. Current survey data reveals that at the all-India level, 77 percent of families do not have a regular salaried person.
4. Faulty Employment Planning: The Five-Year Plans implemented by the government have not contributed proportionately towards the generation of employment. The assumption was that growth in the economy would automatically generate enough employment. But in reality, the situation does not quite match up to the assumption and there have remained gaps between the required number of jobs and the actual numbers generated.
5. The drawback of Agriculture Infrastructure: According to current statistics, agriculture remains the biggest employer in the country contributing to nearly 55 percent employment. But ironically, the sector contributes a meagre 17 percent to the country’s GDP. The problem of disguised unemployment has turned out to be the most significant contributor behind this deficit. Also, the seasonal nature of employment in this sector builds up recurring cycles of unemployment for the rural population. Lack of proper irrigation infrastructure and the use of outdated cultivation methods render most of the agriculture land in India usable for cultivating just one crop a year. This is another contributing factor towards seasonal nature of unemployment in the sector.
6. Alternative Opportunities: There has been a definite push towards providing the people employed by the agriculture-based industries with alternate methods of employment during the lull seasons. Skill-based training for their employment in other sectors is lacking till date.
7. Slow Industrialisation: The industrial position in India is still slow to flourish. Agriculture remains the most prominent employer in the country. People are not yet keen towards self-employment, especially in the rural sector, depending on existing employment opportunities.
8. Lack of Investment: Inadequacy of capital investment persists heavily in India and that has been a critical contributor in not setting up enough industry that in turn employs the labour force.
9. Immobility of Labour: One more factor that leads to unemployment is people not being interested in moving for jobs. Responsibility and attachment to family, language barrier, religion and lack of transport are key contributing factors in this regard.
The problem of unemployment is mainly an economic one. It is essential, therefore, that the economic policy of the country be overhauled. In our country, labour is available in abundance. We should provide avenues for employment for them through the cottage and small-scale industries. Besides this, stress must be laid on family planning. Every effort must be made to check the rapid rise in population. This will help a great deal in the solution of this problem.
The villages should become self-sufficient in their economy so that the villagers would not run to the cities in search of jobs. The government should encourage and develop the agriculture-based industries in rural areas so that the rural candidates do not migrate to the urban areas. More employment should be generated in rural areas for the seasonal unemployment people. This would ensure that the large cities are not overcrowded with a huge population. It would help maintain the balance between the job/vacancy and the job seekers. The present education system should also be changed radically. Instead of giving only theoretical education, the students should be given vocational training so that they can start some work after they finish their education. These institutes prepare students with skill and knowledge for a particular trade. There is growing demand for skilled people in various industries. The country should promote industrialisation so that more job opportunities can be created for the workers. The focus should be on heavy industries that employ thousands of employees of various skills. Last, but not the least, to solve the problem of unemployment in India, the government must smoothly streamline its liberalisation policy. This initiative would encourage foreign companies to start their manufacturing units in India, which in turn, would increase the employment opportunities.