New Delhi: The government on Monday asserted that the Indian economy needs to generate around 78.51 lakh jobs annually in the non-farm sector to meet growing demand and population growth. Keeping the job scenario in view, the government plans to take steps to meet the demands in the country, covering the segments like labour market, artificial intelligence (AI), gig work and climate change among others.
As per the economic survey reports for 2023-24, it highlights that India’s workforce is nearly 56.5 crore, with more than 45 per cent employed in agriculture, 11.4 per cent in manufacturing, 28.9 per cent in services, and 13.0 per cent in construction. “The Indian economy needs to generate an average of nearly 78.5 lakh jobs annually until 2030 in the non-farm sector to cater to the rising workforce,” said the survey.
This is followed by an estimation of the annual rise in job creation required to cater to the expanding working age population, rising female participation in the labour force, and labour shifting out of agriculture. Next, the agro-processing sector is proposed as a fertile sector for job creation in a pragmatic and decentralised manner.
The survey also laid emphasis on the private sector’s role to create employment in the country, saying that in more than one respect, the action lies with the private sector. “In terms of financial performance, the corporate sector has never had it so good. The results of a sample of over 33,000 companies show that, in the three years between FY20 and FY23, the profit before taxes of the Indian corporate sector nearly quadrupled,” the survey noted.
As per the survey, in terms of employment status of workers, 57.3 per cent of the total workforce is self-employed, and 18.3 percent is working as unpaid workers in household enterprises. “Casual labour comprises 21.8 per cent of the total workforce and regular wage/salaried workers are 20.9 per cent of the total workforce,” it said.
Further the survey also noted that gender-wise, it is the female workforce, which is shifting to self-employment, while the male workforce’s share has been stable. “This is evident in the sharp rise in female labour force participation rate (LFPR) in the past six years, driven by rural women joining agriculture and related activities,” it said.
Keeping the country’s economy in view, the survey also noted that nominal GDP grew 9.6 per cent y-o-y to Rs 295-lakh crore. “Hiring and compensation growth hardly kept up with it. But, it is in the interest of the companies to step up hiring and worker compensation,” the survey stated.
Besides, the survey also provided a broad estimate of the number of jobs (78.5 lakh annually) that the economy has to generate. "Everyone in the working age will not seek jobs. Some of them will be self-employed and some of them will be employers too. More than jobs, economic growth is about generating livelihoods. The governments at all levels and the private sector will have to strive together for it,” it said.
However, the survey pointed out that the rising employment of flexi workers through staffing companies can be a channel for ensuring social security for informal workers. “There remain long-existing challenges of formalising a burgeoning workforce, facilitating job creation in sectors which can absorb workers shifting from agriculture, and ensuring social security benefits for those in regular wage/salaried employment,” it said.
The survey further suggested that state governments can grease the wheels of hiring by easing the compliance burden and reforming laws on land. “Concurrently, the employment landscape is fast changing worldwide, and India, aspiring to be a developed nation by 2047, must partake in the massive reshaping of jobs that AI has and is likely to further spin off,” it added.
It also noted that the impact of automation on workers being complex and uncertain, the direction of technological change remains susceptible to forces of political economy. “India thus needs to invest in research and steer the AI bandwagon towards shared prosperity,” it suggested, adding that something as basic and age-old as unpaid care work needs attention too.
Lastly, the survey also suggested that labour laws need to be reviewed to re-evaluate incentives for employers, with a focus on achieving better outcomes for economic growth and prosperity in the manufacturing sector. “Implementing more flexible labour laws could unleash substantial economic potential, promote gender inclusivity, and attract industrial investment,” it said.
