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| Missing: An employment plan | | Inclusive growth needs massive increases in jobs |
| Business Standard / New Delhi Nov 19, 2009, 00:08 IST |
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A number of recent incidents, many of which pose a threat to social order, highlight the stress that the economy faces in terms of generating jobs for larger numbers of aspiring young people. Between 12 million and 15 million new jobs need to be generated each year to accommodate new entrants into the workforce, beyond the number needed to take care of the backlog of unemployed. Only a small fraction of those numbers is actually available, particularly in the organised sector. The recent demand by the Maharashtra Navnirman Sena (MNS) that the State Bank of India recruit only Marathi-speakers for 1,100 jobs being offered in the state is an acute reflection of the problem — as is the fact that people with post-graduate management degrees have been applying in large numbers for clerical jobs in banks. As in most large-scale recruitment programmes in the public sector these days, the number of applicants is almost 100 times the number of openings. This imbalance between demand and supply is bound to attract political intervention; the longer the imbalance persists, the more extremist that intervention is likely to become. However critical one may be of the MNS and its aggressive regional chauvinism, it is important to recognise that the paucity of employment opportunities feeds its support base — and also contributes to the swelling of Maoist ranks.
It is an unfortunate reality that, while the economic reform process has brought many benefits to many people, it has under-achieved when it comes to generating jobs. After the late 1960s, the public sector became the dominant source of jobs outside agriculture, and provided a pathway to middle-class security for millions. The public sector’s other weaknesses may have ensured that this largesse could not continue indefinitely but the fact is that its role as an employment provider withered without a corresponding increase in the contribution from the private sector. While this accounts for the broad imbalance between jobs and people looking for them across the country, certain segments of the population, which were relatively more dependent on public sector employment, have lost out disproportionately. It is possible that this is one factor underlying the angst among Marathi-speakers. The eastern part of the country, which was the biggest beneficiary of public investment during the public sector’s heyday, has also lost out and the huge out-migration is a consequence.
The problem is that there is no comprehensive employment strategy in place. The rural employment guarantee programme is a safety net, not a solution to unemployment. The country needs an employment plan, based on assessments of demand, the capital-intensity of jobs in different sectors, the training and other facilities needed to prepare people for jobs where they are likely to be created, and a proper mix of opportunities for school leavers and those with higher education. The threat to social stability from the growing number of frustrated job-seekers is simply too large to be ignored.
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