Employment challenges

Shortage of jobs in India in next 35 years

Business & Politics

News - Biz@India

April 28, 2016

/ By / New Delhi



India will face employment problems in the future and there will be a shortage of jobs in the country in next 35 years

India will face employment problems in the future and there will be a shortage of jobs in the country in next 35 years

According to United Nations Development Programme (UNDP), India will witness a major shortage of jobs in the next 35 years.

As per a report released by United Nations Development Programme (UNDP) on April 27, 2016, India will face employment problems in the future and there will be a shortage of jobs in the country in next 35 years.

As suggested by UNDP, countries like India with high low-income population, big agricultural sectors and high rural to urban migration, should focus on specific industries to create more jobs, especially in manufacturing sector. “In India, the manufacturing base is still small, contributing to only 15 pc of GDP and 11 pc of employment,” the report said.

“India faces a serious challenge of finding jobs for a growing population over the next 35 years; its economy could absorb less than half the new entrants into the labour market between 1991 and 2013”, it added.

Between 1991 and 2013, the size of the working age population increased by 300 million and out of these people the Indian economy was able to employ only 140 million. According to the estimates, around 280 million people will enter the job market in India by 2050.

As per the labour ministry data, around 1 million people enter the workforce in India every month while the others choose to study further.

Governmental initiatives

Employment problem in the country is also one of the driving forces behind the government’s “Make in India” campaign aimed at attracting foreign investments in manufacturing sector and India could reap demographic dividends if it succeeds in this campaign.

The government seems to have realised the issue and the problem could be addressed if the government takes effort to create more manufacturing jobs through programmes like these.

According to the report, China and India accounted for 62 pc of the workers in the Asia-Pacific region in 2015, with 1 billion and 860 million workers, respectively.

“China’s share of working-age people is now falling, while India’s continues to rise, and is expected to touch a maximum of about 1.1 billion in 2050. To a large extent, China and India, now home to 2.6 billion people, will drive demographic changes in the region and influence their consequences. India’s population will likely surpass China’s by 2022, possibly earlier,” the report said.

A large informal sector

India’s challenge of providing remunerative employment is complex because of its large informal sector. While the informal economy employs a large number of low-wage workers, it leads to many problems, including inadequate protection for workers.

Rising wage inequalities in India, Indonesia, Philippines and Vietnam are a result of the widening wage gaps between people with higher education and those at lower levels of schooling.

“Without intervention, today’s inequalities in education will become tomorrow’s inequalities in the distribution of wealth and wider opportunities for human development,” the report said.

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