prasad1
Active member
Besides co-ntrolling food infla-tion, the most challenging task before Narendra Modi is to create jobs for millions of young men and women, some of whom were responsible for his resounding victory in the elections. It is one thing to promise jobs and another to actually create them. Despite phases of high growth of gross domestic product (GDP), there has not been commensurate growth in jobs — a phenomenon called “jobless growth”. For the first time in the history of India, the country’s GDP grew by more than 9 per cent three years in a row, between 2005-06 and 2008-09. If one looks at the data that has been put out by the National Sample Survey (NSS) Organisation, between 1999-2000 and 2011-12, the average annual rate of job creation was only 2.2 per cent.
In other words, even if the economy grows at a relatively fast pace, there is no guarantee that new employment opportunities will be created at a similar pace. India is not unique among developing countries where despite the fall in the share of agriculture in GDP, the proportion of people dependent on farming and allied activities for their livelihood does not come down commensurately. At present, the share of agriculture and “allied activities” (which include horticulture, forestry and fishing) in India’s GDP is in the region of 16 per cent, although this sector directly provides livelihood to half the country’s population.
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The estimates vary but anywhere between one million and two million young people (who are 15 years of age or older) are entering India’s job market every year. There has been much talk of reforming labour laws. There is a view that once the provisions of the Factories Act, the Industrial Disputes Act and the laws relating to engaging contract labour are liberalised (as is being sought to be done by the Rajasthan government), this would automatically kick-start the economy and create jobs.
But, contrary to what neo-liberal economists argue, changing labour laws will not kick-start the economy. Can the government not just revive manufacturing industry but also ensure that manufacturers opt for labour-intensive techniques of production and not capital-intensive ones, as has been the norm so far? This is easier said than done.
In other words, even if the economy grows at a relatively fast pace, there is no guarantee that new employment opportunities will be created at a similar pace. India is not unique among developing countries where despite the fall in the share of agriculture in GDP, the proportion of people dependent on farming and allied activities for their livelihood does not come down commensurately. At present, the share of agriculture and “allied activities” (which include horticulture, forestry and fishing) in India’s GDP is in the region of 16 per cent, although this sector directly provides livelihood to half the country’s population.
................................
The estimates vary but anywhere between one million and two million young people (who are 15 years of age or older) are entering India’s job market every year. There has been much talk of reforming labour laws. There is a view that once the provisions of the Factories Act, the Industrial Disputes Act and the laws relating to engaging contract labour are liberalised (as is being sought to be done by the Rajasthan government), this would automatically kick-start the economy and create jobs.
But, contrary to what neo-liberal economists argue, changing labour laws will not kick-start the economy. Can the government not just revive manufacturing industry but also ensure that manufacturers opt for labour-intensive techniques of production and not capital-intensive ones, as has been the norm so far? This is easier said than done.
