NEW DELHI: Despite notable progress in various aspects of India's labour market, the unemployment rate has reached a staggering 42% among graduates under 25 years old, according to the State of Working India 2023 report released by Azim Premji University.
"Post-Covid, the unemployment rate is lower than it was pre-Covid, for all education levels. But it remains above 15% for graduates and more worryingly it touches a huge 42% for graduates under 25 years," the report said.
According to the report, after stagnating since the 1980s, the share of workers with regular wage or salaried work started increasing in 2004, going from 18% to 25% for men and 10% to 25% for women.
"Between 2004 and 2017, around 3 million regular wage jobs were created annually. Between 2017 and 2019 this jumped to 5 million per year. Since 2019, the pace of regular wage job creation decreased due to the growth slowdown and the pandemic," it added.
The report underscored the critical importance of addressing the weak connection between economic growth and job creation. It reveals that non-farm GDP growth and non-farm employment growth have shown no correlation since the 1990s.
"However, between 2004 and 2019, on average, growth translated to decent employment. This was interrupted by the pandemic which caused larger growth in distress employment," it added.
Though the gender-based earnings disparities have reduced, the gap has remained constant since 2017. In 2004, salaried women workers earned 70% of what men earned. By 2017, the gap had reduced, and women earned 76% of what men did, as per the report.
Interestingly, the report also highlighted the fact that even in the smallest firm sizes, SC and ST workers are under-represented compared to their share in the overall workforce. But even more significantly, SC and ST owners are barely represented among firms employing more than 20 workers. Correspondingly, upper caste overrepresentation increases with firm size.
The report also highlights a concerning increase in female self-employment to 60% post-Covid from a pre-pandemic rate of 50%, driven by distress, resulting in declining real earnings.
In 2004, over 80% of sons of casual wage workers across all castes, were themselves in casual employment.
"For non-SC/ST castes, this fell from 83% to 53% by 2018 and the incidence of better-quality work such as regular salaried jobs increased. It fell for SC/ST castes as well, but to a lesser extent (from 86% to 76%)," said the report.