Mapping employment

Data must be collected from employees, not employers

The task force recently set up on employment data under the leadership of NITI Aayog Vice-Chairman Arvind Panagariya has a tough yet critical task ahead. Data on employment have always been difficult to estimate in India, but a rapidly changing economic environment and the emergence of new forms of contracts make it even more difficult to pin down job numbers. Good economic and monetary policies require almost real-time data on employment, and those, in turn, require a mechanism that captures the many facets of employment in a timely manner. This includes data from the rural and urban economy and from the formal and informal sectors. Data should capture contractual and non-contractual, full- and part-time, temporary and permanent workers, and, for that matter, casual employees working in home enterprises or for others  with sometimes multiple simultaneous occupations. This apart, the data must capture the many other new forms of employment emerging in the new digitally-driven economy.

The Labour Bureau has been supplying data for the last many decades. However, the data have so many gaps that they have little practical value. Employment figures culled from the National Sample Survey Office’s annual and quinquennial surveys are better but are available a year or so after they are collected — too late for any quick response policy measure. Comprehensive time-use surveys can better capture multiple occupations, but despite semi-successful piloting some years ago, India has not made much headway on that front. There is another problem that the task force will need to consider. There are a wide variety of employment contracts, and today it is not uncommon for formal sector employers to hire a substantial number of workers informally, and for informal sector entities to hire workers through formal contracts. Moreover, the new digitally-driven economy is creating opportunities for a large number of self-employed and employed workers who are invisible to the normal data collection processes.

So what is the solution? Given the large share of employment in informal and semi-formal units, it is obvious that any data mechanism that depends upon reporting by employers will either be inordinately complex or only cover some part of the economy. A comprehensive mechanism, therefore, will need to depend upon regular reporting by households on the many different forms of employment their members are occupied in. Moreover, such an exercise will not only need to capture the many dimensions of employment but also deliver the data rapidly to enable proactive policymaking. If not real time, a week’s gap between collection and estimate availability is the maximum the government should settle for. Digital technologies, automated statistical algorithms, cloud-based data access, and new telecom and GIS technologies can enable such a mechanism, as is occurring globally. It would be interesting to see whether the government’s statistics and data collection set-up can acquire the skills or partner with an entity outside the government to meet the challenge. The government may have set up the task force with the noblest of intentions, but the Panagariya panel on employment data has a tough task ahead.