The NSSO 1999-2000 data shows the number of unemployed has increased from 20.13 million in 1993-94 to 26.58 million in 1999-2000. Consequently, the unemployment rate -- the number of people unemployed as a percentage of the labour force -- increased from 5.99 per cent in 1993-94 to 7.32 per cent in 1999-2000. The highest unemployment rate was in Kerala -- with 20.97 per cent of the labour force without work -- and the lowest in Himachal Pradesh where 2.96 per cent people had no work.
Where are the jobs?
The problem is that modern industry creates a chimera of jobs. For all the fuss made of the economic might of industry, it provides a mere 8.35 per cent of the total employment. Worse still, the glamorous and much touted private sector provides only 2.58 per cent and the much-abused public sector 5.77 per cent of this formal employment. Mining, water and electricity and in community and social services are the largest employers in the public sector. Unfortunately, with the decline of public services and demands for downsizing, this sector is showing a negative growth overall. On the other hand, with capital intensity growing in the private sector, its rate of growth has been near zero as far as jobs are concerned.
This when the maximum increase in employment growth rate over the 1990s decade was in the sectors of construction (7 per cent), financial services and transport and communication (roughly 6 per cent each). But it is the unorganised sector, which provides the job benefits. For instance, the small and medium manufacturing enterprises contribute nearly 80 per cent of the manufacturing sector employment and its employment elasticity is almost 3 times more than the organised sector.
But all this so-called growth in the construction-trade-transport and services sector is negated because agriculture, the major employment generator, has stopped absorbing people. The annual growth rate in this sector declined from 1.51 per cent in the 1983-94 period to -0.34 per cent in 1994-2000.
Another indicator of worsening employment scenario inrural areas is the declining share of self-employment in total rural employment from 58.9 per cent in 1977-78 to 52.9 per cent in 1999-2000. This indicates the proportion of farmers who cultivated their land has decreased because of declining yields or fragmentation of holdings. Similarly, there is a sharp increase in the share of casual employment over time -- reflecting the displacement of marginal cultivators and their conversion into agricultural labour. As a result, casual labour increased from 29.7 per cent of rural employment in 1977-78 to 37.3 per cent in 1999-2000.
Employment programmes fail to create enough rural jobs, people migrate
|Rural Employment Programme under the 10th Five Year Plan
||Increase in employment opportunity (in million person years)
|Sampoorna gramin rojgaar yojana
|Swarnajayanti gram swarozgar yojana
|Pradhan mantri gram sadak yojana
Will job programmes work?
Government runs rural employment programmes to create jobs in times of distress. The two key programmes of the early 1990s -- Employment Assurance Scheme (EAS) and the Jawahar Gram Samridhi Yojana (JGSY) -- have been renamed and relaunched a dozen odd times with changes in political leadership. In 2001, the schemes were merged into a single employment programme, namely the Sampoorna Gramin Rozgar Yojana (SGRY) with an enhanced annual outlay of Rs 10,000 crore, to create 10 million person days of employment each year. The government's calculation was simple. It had been shown (on paper) that 0.5 million person days were generated through EAS and JGSY with its allocation of Rs 6,000 crore annually (see table: Runaway bus).
Therefore, a doubling of budget would ensure a doubling of employment, it assumed. The question is if the schemes can actually create the jobs and if these casual jobs work more as supplementary source of employment in time of crisis or as real employment. The question also is how these programmes can be used to create continuous employment.
The job scene therefore looks grim. The organised sector has a low base and is shedding jobs. According to government estimates, even if this sector grows by a phenomenal 30 per cent per annum till 2007, its contribution would just go up from 2.58 per cent to 3.5 per cent in the employment chart. At the same time, large enterprises threaten the survival of the unorganised sector. The public sector is being downsized. The public and social services are being disabled. The agricultural sector -- still comprising 57 per cent of India's total employment -- is in decline. What is then the way ahead? How will the government make good on its 10 million jobs a year promise?