The Geneva-headquartered International Labour Organization (ILO), in partnership with the New Delhi-based Institute of Human Development, recently released a report on ‘Youth Employment, Education and Skills’. It analyses the youth employment situation in the context of the emerging economic, labour market, education and skills in India, as well as the changes over the past two decades. The report analyses data from the national sample surveys, periodic labour force surveys and other sources between 2000 and 2022.
Its overall conclusion is that the workforce participation and unemployment rates in India have deteriorated between 2000 and 2019, with some improvement thereafter. Interestingly, the improvement coincides with periods of economic distress before and during the pandemic, except for the two peak pandemic quarters.
Between 2000 and 2012, employment grew at an annual rate of 1.6 percent, while gross value added grew at a much faster 6.2 percent. During the latter period, from 2012 to 2019, even though the gross value added grew at an annual rate of 6.7 percent, employment grew at a depressing 0.1 percent. After 2019, there was an increase in low-paid agricultural employment.
The youth constituted 27 percent of India’s population (371 million) in 2021, and is expected to decline to 25 percent by 2031. Each year, 7-8 million young people are added to India’s labour force, whose productive use could enable India to reap a demographic dividend and accelerate growth. The report, however, reveals the sad trajectory of youth unemployment in India—it increased nearly threefold from 5.7 percent in 2000 to 17.5 percent in 2019, and declined to 12.1 percent in 2022.
The share of unemployed youth among all unemployed Indians was estimated to be as high as 83 percent in 2022. The unemployment rate was much higher among the youth in urban areas than in rural areas, and among younger ones (15–19 years) than older ones (20–29 years). Female unemployment rates were much higher than male in 2019, but fell to the same level by 2022.
Worse is the plight of the educated young, who reported high rates of joblessness—increasing sharply from around 14.4 percent in 2012 to 26.3 percent in 2019 and declining to 21.8 percent in 2022. Among the educated men with secondary or higher educational, the unemployment rate doubled from 11.9 percent in 2012 to 24.2 percent in 2019 and 20.3 percent in 2022. Among the educated women, it was around 24 percent in 2012, peaking at 34.6 percent in 2019 and falling to 27.6 percent in 2022.
Unemployment worryingly increased with the level of education, with the highest rates recorded among those with a graduate degree or higher; again higher among women than men. In 2022, the unemployment rate among those with primary education or lower was 3.1 percent; it rose to 11.5 percent among those with secondary or higher secondary education. It rose sharply to 28.7 percent among youth with graduate degrees and above.
The pandemic led to a drastic change in the situation. There was an increase in largely informal, unpaid and low-paying work, especially in the farming and construction sectors, and among women. The number of youth in self-employment expanded much more than in other categories of employment during the pandemic, which was mostly in household unpaid work, especially among rural women.
The report presents a state-wise employment conditions index considering parameters such as the proportion of workers employed in regular formal work, and similarly of casual workers and self-employed workers below the poverty line, the average monthly earning of casual workers, and unemployment rates. The situation in northern and eastern states such as Bihar, Jharkhand, Uttar Pradesh, Rajasthan, Madhya Pradesh, Assam, Odisha and West Bengal is worse than in other states.
The extreme distress prevailing among India’s youth can be seen in some recent examples. For 62 ‘peon’ posts to be recruited by the UP police, for which the minimum qualification was Standard 5 education, more than 93,000 candidates applied, including 3,700 PhD holders, 5,000 graduates and 28,000 postgraduates. In May 2023, UP received a staggering 5.5 million applications for group D jobs such as peon, watchman and gardener, of which many candidates were overqualified with a bachelor’s or master’s degree in technology, business administration, arts or science. For 15 vacant posts of peons, drivers and watchmen in Gwalior, MP, nearly 11,000 unemployed youth with graduate, post-graduate degrees, engineering, MBA or PhD degrees applied, from within and outside the state. In 2022, for 1,50,000 jobs in the Indian Railways in Bihar and UP, millions of youth applied. Irregularities in recruitment led to widespread protests and violence in the two states. The situation in some developed states is no better. For instance, in June 2022, about 1.7 million people applied for 3,400 jobs in Gujarat requiring a minimum qualification of Class 10.
Youth unemployment rates are high in almost all states, irrespective of their development status, which is a severe indictment of our political leaders. Rozgar melas and the Agnipath scheme have miserably failed to address the gargantuan unemployment problem among the youth. There is a mismatch between the educational aspirations of India’s youth and the skill requirements of a growing and diversifying economy. Policy makers need to find a solution to this gargantuan problem.
K N Ninan
Former professor of economics, ISEC, Bengaluru
(Views are personal)
(ninankn@yahoo.co.in)