Tag: Jobs In India

Indian Youth Jobs and Disenchantment

Youth, Jobs and Disenchantment in India

By Sanjoy Narayan

Recently, the National Council of Applied Economic Research (NCAER), which is India’s oldest and largest independent non-profit economic research and policy think tank, released a study that found 38% of workers who deliver food for app-based services were at least graduates or above; and 93% had completed 10th standard school education. In Tier 2 cities (with a population of between 50,000 and 99,999), nearly 40% of delivery workers were graduates.

There are an estimated 7 million gig workers who deliver food for app-based services such as Zomato and Swiggy or other goods and packages for services such as Amazon. The NCAER report suggests that a sizeable proportion of food delivery workers are highly educated and could be overqualified for the tasks that they have to perform. 

They could also be underpaid. According to another survey by Borzo, a same-day delivery service, around 78% of gig delivery workers, employed with food and other delivery apps earn less than Rs 2.50 lakh per annum or around Rs 20,000 per month. Many, if not most, of these workers are the sole earners for their families, which often include elderly dependents as well as minors and unemployed kin, so the wages they make can be piffling.

Moreover, gig workers such as those covered by these reports work much longer hours than others. The NCAER report found that the average weekly working hours for platform workers amounted to 69.3 hours, in contrast to the 56 hours reported for workers included in the Periodic Labour Force Survey (PLFS), which computes the government’s estimates of employment and unemployment. So, a gig worker typically works nearly 10 hours seven days a week to earn a meagre wage.

In addition, gig workers in India are not covered under labour laws, leaving them without legal protection against discrimination, unfair termination, or workplace harassment. Additionally, they are deprived of crucial benefits such as health insurance, retirement benefits, and paid leave. Instead they often face penalties if they slip up on tight delivery time targets. 

To be sure, some gig workers take those jobs to complement the income they might earn from other jobs that they hold but presumably for a large proportion of such workers, the gigs are their primary jobs.

Let’s shift the focus a bit now to jobs in general in India. First, a quick statistical recap on India’s youth population. Of 1.4 billion Indians, 50% (700 million) are below the age of 25; and more than 65% (>900 million) are below the age of 35. While those are huge numbers, the average age of an Indian is 29 (in China it is 37; and in Japan 48). The estimated number of young Indians (in the 15-24 age group) is 254 million; and the population of working age Indians (15-64) is estimated at more than 950 million.

It is also estimated that only around half of that working age population is employed and that too most of them in agriculture where, on overcrowded tiny farms, employment can be an euphemism for joblessness. People are forced to stay on although they add little or nothing to a farm’s productivity simply because there is no alternative option to earn an income. 

So, it is no surprise that when vacancies, such as for government jobs, are announced, the rush to apply for them is unprecedented. 

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Consider a couple of examples, none of them is apocryphal: This year for 60,000 police constable jobs in the populous state of Uttar Pradesh, there were 4.8 million applications. When the Indian army recruits soldiers, the selection ratio is as low as 3%. 

Government data on youth unemployment is patchy, discontinuous, and ambiguous but it is clear that youth unemployment is a serious issue simmering under the surface in India. Of the estimated 500 million or so Indians who are deemed to be employed, only a quarter or around 130 million, are in the organised sector (government or private sector jobs). The rest work in unorganised sector jobs where benefits, including wages, can be low, uncertain, and unregulated.

The numbers are equally staggering when it comes to people seeking admission to professional institutes. In 2023, more than 2 million people took the National Eligibility cum Entrance Test (NEET), a standardised national-level entrance exam in India for students who wish to pursue undergraduate medical education in government or private medical colleges. The number of seats they were competing for was 108,000. The selection ratio was a shade above 5%. In 2023, 1.5 million people took the joint entrance exam to get into engineering colleges. They were competing for 250,000 seats.

The intensity of the pressure and competition to get into institutions is high and it is borne out by incidents such as the NEET. This year, there were allegations of a paper leak, backed by a mafia of operators who sold exam papers before the test and jeopardised the futures of thousands of candidates.

Examples such as the state of gig workers or the lack of organised sector jobs for India’s youth, or the exam paper leak scandal are just a few indicators of how disenchanted India’s youth might be. 

Despite being one of the fastest-growing economies, India faces significant unemployment issues, especially among the educated youth. There is often a gap between the skills that graduates possess and what employers need, leading to underemployment or joblessness.

The fragility of such a job market can be exacerbated by periodic economic slowdowns and global uncertainties. And, finally, the sheer number of job seekers compared to available opportunities creates intense competition, making it difficult for many to secure stable employment.

The government often cites figures that show a rise in the number of start-ups and the growth of the gig economy as evidence that there are more opportunities for India’s youth. But for the cohort of more than 250 million young Indians are such options the outcome of genuine entrepreneurship and innovation or signs of frustration and desperation? You decide.

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How India Fares On Economic Indicators

By Kunal Bose

Given even half a chance, politicians of all hues will indulge in breast beating. The country was witness to this once again when in the course of 2022-23 budget presentation finance minister Nirmala Sitharaman claimed India’s expected GDP (gross domestic product) growth of 9.2 per cent during 2021-22 would be highest among all large economies. This “sharp recovery and rebound of the economy is reflective of our country’s strong resilience.” In the meantime, however, the Manila headquartered Asian Development Bank in its recently released ‘Asian Development Outlook 2022’ report says India’s GDP last year ‘likely’ grew 8.9 per cent. Mark the word likely in ADB’s calculation.

Whatever 2021-22 growth is finally recorded, Sitharaman could always say in her defence that she presented the budget two months before the closure of financial year and she was only referring to advance estimates. A Trinamool Congress MP was certainly not fair in saying the FM was speaking with ‘fork tongued’ in making such a tall claim for the economy under her charge. No doubt she was boastful, for last year’s growth should ideally be seen against the background of GDP slipping 6.6 per cent in 2020-21. And the 2019-20 GDP growth was a dispiriting 3.7 per cent, very closely approximating the Hindu rate of growth coined by economist Raj Krishna.

The whole of 2019-20 when the bite of Covid-19 pandemic manifested in a series of deadly infections, lockdowns, supply chain disruptions and large-scale migration of labourers to their villages and small towns suffering in the process unbearable hardships was a washout for all economies and India was not an exception. Even while fears of new Covid waves remained throughout the year that closed in March 2021, any relief on that count was negated by high rates of inflation.

Retail inflation, as measured by consumer price index combined (CPI-C) was 6.6 per cent during 2020-21, breaching the Laxman Rekha or threshold level of 6 per cent. But with the revival of economic activities in the post Covid 2021, high inflation became a global phenomenon. For example, among developed countries, the US experienced inflation of 7 per cent in December 2021, the highest since 1982 and in the emerging economic bloc, Brazil suffered price rise of 10.1 per cent in the same month. Expectedly inflation at the rate of 6.6per cent became a source of major popular discontent leading New Delhi to take supply side measures and that tamed it to 5.2 per cent in 2020-21 till December.

But any comfort on inflation front unfortunately for the government and the masses proved short lived. Energy prices were already high when President Vladimir Putin sent his troops to Ukraine in an act of aggression on February 24. That sent oil and gas prices through the roof. As oil and gas and aviation turbine fuel invite very excise duty and also stiff levies at the state level, the two commodities not being covered by GST (goods and services tax), their prices are now greatly stoking inflation. Look at prevailing domestic LPG prices from PPP (purchasing power parity) dollar angle, truly reflecting the local currency’s purchasing power and the income level of average Indian, these are the highest in the world. As for petrol, we pay the third highest price only after Sudan and Laos. Indian oil marketing companies have started buying Russian crude at discounted rates.

As is to be expected, Indian buying of Russian crude has not gone down well with Western nations sanctioning the aggressor country on a growing number of counts. For example, the US has banned all energy supplies from Russia and the UK is working on phasing out oil and coal of that origin by yearend. Whatever sins Russia may be committing, India has deep political and economic ties with that country and the world is aware of that. India has served notice that it will continue to buy crude oil from Russia to protect its own economy.

In any case, fuel prices continuing to rise to new record levels are having an inevitable domino effect with food, edible oils and stationery prices getting revised periodically in sync. A survey conducted by the leading Bengali daily Anandabazar Patrika of families in the monthly income bracket of ₹15,000 to ₹45,000 about how they are coping with the sudden major spurt in inflation found one common answer that even after doing with less of every single item of food and other daily necessities, their savings are going for a toss. Some have lost the capacity to save. Others have started using up what they saved in the past. Experiences of families with identical income or even a little more in other parts of the country are either faring the same or even worse. If this is the condition of people with a regular income, whatever is the size, then think how badly the ones who lost their jobs during the Covid and never got them back or whose deep salary cuts are still to be restored are doing.  

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Mercifully, the unemployment rate, according to the Centre for Monitoring Indian Economy (CMIE), has started declining with economic activities slowly gathering steam. CMIE’s monthly time series data shows unemployment rate was down to 7.6 per cent in March from 8.10 per cent in February. Economist Abhirup Sarkar, however, makes the pertinent observation that even “this unemployment rate is high for India which is a poor country. Poor people, particularly in rural areas cannot afford to remain unemployed, for which they are taking up any job that comes their way.”

Even while the overall national unemployment rate continues to fall, the ranks of unemployed in some states remain worryingly high ranging from 14.4 per cent for Bihar to 26.7 per cent for Haryana. The accepted fact remains inflation has a negative impact on growth and real per capita income. Inflation is not neutral. In no case does it support growth. That is why on the occasion of release of monetary policy the other day, Reserve Bank of India (RBI) governor Shaktikanta Das said: “In the sequence of priorities we have now put inflation before growth. For the last three years starting February 2019, we had put growth ahead of inflation in the sequence. This time we have revised that because we thought that the time is appropriate and that is something which needs to be done.”

Largely caused by Ukrainian war, the inflation outlook has worsened globally as also for India. RBI has revised upward its inflation forecast for 2022-23 to 5.7 per cent from the earlier 4.5 per cent. If the war persists and sanctions further tightened, raging inflation will not be doused. In fact, inflation here could very well cross the Laxman Rekha as the year progresses. If inflation stays this high what option could be there for RBI but to cut this year’s growth forecast to 7.2 per cent from the earlier 7.8 per cent. Inflation and growth outlook being so fluid, Das’ observation that “we are not hostage to any rulebook and no action is off the table when the need of the hour is to safeguard the economy,” is an important pointer to RBI monetary policy staying flexible.

Commodity prices across the board from oil to steel to aluminium and to copper have all significantly appreciated. This is particularly pinching for the micro, small and medium (MSME) sector, which has a share of around 30 per cent of GDP and provides employment to 111 million. High input prices have pushed up working capital requirements of the sector. Will that incremental financial accommodation be available from banks? Unlike large enterprises, most MSMEs don’t have reserves to fall back upon. New Delhi must see that the MSME sector having a share of close to 50 per cent of total national exports is able to walk through difficult times unscathed.

Industry as a whole has welcomed the government investing heavily in infrastructure projects creating demand for products of a host of industries. The combination of mega capital expenditure programme that hopefully will bring Indian infrastructure close to world class resulting in marked fall in logistical cost and supply side measures is the response expected from the government. Private sector too is not found wanting in announcing major investments and this is led by the steel industry with investment commitment of over ₹1,000 billion in new capacity building.

In the challenging circumstances, Indian farmers well deserve a pat on their back for agriculture and allied industries are expected to have recorded growth of 3.9 per cent in 2021-22 against 3.6 per cent in the previous year. There is no promise that the coming days will bring any relief. One may, however, see a silver lining in the Economic observation: “Despite all the disruptions caused by the global pandemic, India’s balance of payments remained in surplus throughout the last two years. This allowed the Reserve Bank of India to keep accumulating foreign exchange reserves (they stood at US$634 billion on 31st December 2021). This is equivalent to 13.2 months of merchandise imports and is higher than the country’s external debt. The combination of high foreign exchange reserves, sustained foreign direct investment, and rising export earnings will provide an adequate buffer against possible global liquidity tapering in 2022-23.”