https://www.project-syndicate.

org/commentary/rebutting-india-jobless-growth-fears-by-rakesh-mohan-and-anu-
madgavkar-2017-07

The Changing Face of Work in India

MUMBAI – A debate about job creation and employment is heating up in India, fueled by data that seem
to show the country is entering a period of jobless growth. Official statistics suggest that overall labor-
force participation declined between 2011 and 2015, with fewer than two million new jobs created
annually.

If those numbers were the whole story, then India, a country where 16 million people reach working age
every year, would be heading for economic trouble. There are two reasons to doubt that it is. First, the
Labor Bureau’s figures do not provide a full accounting of the country’s labor force; many of India’s 460
million workers, especially the self-employed, are simply uncounted in official surveys. Second, the data
fail to account for the quality of new jobs being created. As India’s labor market evolves in line with the
shift toward a non-agricultural economy, the creation of “gainful employment” – safer, higher-paid, and
more productive jobs – will be the true measure of economic health.

The dearth of timely, reliable data has long been an impediment to the analysis of trends in India’s labor
market. Current government statistics that rely on quarterly surveys do not provide a complete picture of
what is happening nationwide. For example, they track only those enterprises with more than ten
employees, which represent less than 2% of the national total – indicative of the low quality of work in
which the vast majority of Indians are engaged.

The bureau’s annual household survey covers a larger sample of workers, but the latest available datasets
are from 2014-2015. Moreover, the yearly samples can obscure key trends. For example, reporting only
the total number of jobs added in India from 2011 to 2015 – an increase of about seven million – misses
the shift from agriculture toward non-farm jobs in the construction, trade, and transport industries. In
fact, on close examination, the data show that agricultural employment shrunk by around 26 million jobs
from 2011 to 2015, while the number of non-farm jobs rose by 33 million.

While official surveys do suggest a falling labor-force participation rate, that conclusion needs further
testing, because such declines are not usually discernible over short periods. More important, declining
labor-force participation may indicate that more young people are staying in school, for example, or that
more women from poor households are entering the middle class. Both would be welcome developments.

As India’s economy modernizes, it is essential that policymakers design and implement a system of labor-
market assessment that enables more relevant, timely, and accurate analysis of trends. Prime Minister
Narendra Modi’s office recently established a task force that is seeking to achieve just that. One approach
would be to introduce a quarterly employment survey with a much larger sample size. Data from this
more comprehensive survey could then be validated using government figures on enterprises, job search
portals, sales revenue, and taxes.

Good data are especially important for measuring “gainful employment,” which is defined by the type of
work done by people already employed, labor productivity, earnings, and working conditions. Fortunately,
gainful employment already is being stimulated across India. The government’s increased spending on
infrastructure and social services is creating new work opportunities for an estimated seven million
workers, and at wages that are 70% higher than farm-related work. These investments are also helping to
accelerate the shift from agriculture to other sources of income in some of India’s poorest states.

Opportunities for gainful employment are also coming from India’s information technology and business
process outsourcing sectors. Even with growing investment in automation, these sectors have remained
net job creators, and are forecast to add an additional three million workers by 2025 (although a shortage
of employees with the necessary skills could hurt those projections).

Independent work and micro-entrepreneurship are a third source of gainful employment, often supported
by government lending schemes. In India, as elsewhere, digital ecosystems – including cab-hailing
companies, e-commerce players, and digital financial services – are providing new opportunities
(especially for women, in burgeoning self-help groups) to earn decent pay in parts of the country not
typically considered strong labor markets.

Since 2014, these three sources of employment have created high-quality work opportunities for as many
as 26 million Indians. But much more needs to be done. While some workers have benefited from the shift
to non-farm employment, tens of millions more are in need of opportunities. Government and the private
sector could work together to shape and introduce many more targeted initiatives aimed at fostering
gainful employment, such as bolstering tourism and manufacturing

Despite Modi’s “Make in India” initiative, a significant increase in labor-intensive manufacturing is yet to
be seen. But, as rising wages push some manufacturing jobs out of China, India is in a position to
capitalize. Given the current composition of India’s workforce, the potential of the demographic dividend is
such that low-skill, labor-intensive manufacturing should be vigorously pursued. But at the same time, the
government will need to remove hurdles that stand in the way of investment and innovation in certain
higher-skill sectors, especially in the digital economy.

Indians aspire to higher pay and safer, cleaner, and more stimulating jobs. A new emphasis on gainful
employment initiatives – and better statistics with which to measure their impact – would help Indians
achieve their goals.
El rostro cambiante del trabajo en la India
MUMBAI - Un debate sobre la creación de empleo y el empleo se está calentando en la India,
alimentado por datos que parecen mostrar que el país está entrando en un período de
crecimiento sin empleo. Las estadísticas oficiales indican que la participación laboral total
disminuyó entre 2011 y 2015, con menos de dos millones de nuevos empleos creados
anualmente.
Si las cifras son reales, será un gran problema, sin embargo existen algunos trabajadores que no
participan en estas encuestas ni tampoco esta estadística habla de los nuevos empleos. Esto conlleva a
que no se logre realizar un análisis fiable y el mercado objetivo lo realiazan a empresas con mas de 10
empleados. El análisis al que se llega es que existe una disminución de comunidad trabajando, sin
embargo se puede creer que no trabajan porque están estudiando o porque las mujeres pasan a otra clase
social.

Existe otra fuente que se llama encuesta anual de hogares, la cual abarca un mayor número de población,
sin embargo no está actualizada, con los datos de esta muestra que la ocupación en actividades agrícolas
ha bajado e incrementado los no agrícolas.

Ya se está trabajando para crear una encuesta que arroje y abarque una cifra más alta y que las fuentes
de información sean varias; ejemplo portales de búsqueda de trabajo, impuestos, ingresos por ventas…

Lo que se pretende es que India tenga un incremento en el porcentaje de trabajo remunerado,

por lo que el gobierno está trabajando en esto lo que ha llevado a generar nuevos empleos. Otra
fuente de empleos proviene de la tecnología de la información negocio de subcontratación de los
sectores.

El trabajo independiente y el microemprendimiento son una tercera fuente de empleo

remunerado, por lo general se crean con préstamos del gobierno, lo que se espera es que se
realicen alianzas entre el gobierno y el sector privado para que se siga incrementado el trabajo
renunerado, la vista está enfocada en turismo y manufactura, este último no se ha visto
incremento.