In the last couple of weeks, India has witnessed two major news events that, in any other country, would have been regarded as a clear sign of restlessness triggered by a brewing unemployment crisis.
The first was an unemployed youth jumping into the Lok Sabha chamber when it was in session and burst gas canisters, creating a serious security breach. This man and his five associates were apparently frustrated by their inability to find jobs, and therefore decided to protest in the manner they did. They have now been charged under anti-terror law Unlawful Activities (Prevention) Act, or UAPA.
The second incident was the grounding of a Nicaragua-bound flight carrying 303 mostly Indian passengers by the French government in Paris. These Indians, it appears, were either being trafficked or were headed towards Mexico to undertake that arduous and dangerous journey to illegally enter the United States in search of better economic prospects.
In most other democracies, the gravity and scale of these two events would have meant a national conversation on jobs, unemployment, underemployment and the nature of economic growth. India, as it has now become a norm, has decided to skip that conversation for the most part. This conversation, more than the one that blames the incumbent government, ought to be about the economic trajectory of the country and its social security net.
Also read: Why Indians aren’t protesting against rising unemployment
The quantity of jobs
For starters, it’s useful to look at India’s job scene in terms of how many people are looking for a job and how many jobs are available. India produces about 12 million college graduates each year, which means as many entrants in workforce. It’s reasonable to estimate at least half of them or more—say about 6-8 million—look for jobs. And the country’s Gross Enrollment Ratio into colleges is 27 per cent, which means about four times as many people without a college education likely join the workforce each year. This translates to about 24-32 million people. Together, some 30-40 million people join the workforce each year in India. Now, it’s not as if those who joined the workforce in the previous years have all found employment. The backlog in terms of unemployed youth is likely to be massive as well.
According to the payroll data of EPFO, the average number of new jobs added per year, for the five-year period from 2018-19 to 2022-23, is 9.5 million. This figure includes jobs that existed for less than the full duration of the year; so it may be overstating the number of jobs created. Even if we assume this higher number to be true and that twice these number of jobs were added in informal sectors that the government isn’t counting, then that still leaves about 5-10 million people who enter the job market each year without any jobs on offer. And if we add the already jobless people in the system, it’s a mind-boggling number. Calculated thus, in a five-year period, India adds the entire population of a mid-sized European country like The Netherlands or Romania to its newly jobless.
The Periodic Labor Force Survey (PLFS) throws some detail to this. As per the latest survey, for the period July-September 2023, the number of people working in the “regular wage/salaried employees” category declined 0.5 percentage points compared to the preceding three-month period. That is, in April-June, 49.2 per cent of all workers in India were in the category of “regular wage/salaried employees”. In July-September, that figure fell to 48.3 per cent. Worryingly, the category “unpaid helper in household enterprises” went up by 0.5 percentage points, from 6.1 per cent to 6.6 per cent during the same period. In other words, while the overall report shows a falling unemployment rate, the quality of the employment has deteriorated a bit as well.
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The quality of jobs
This movement of 0.5 percentage points one way or another wouldn’t be of much concern if this were a one-off event. The problem is, the bleak prospects and the deteriorating quality of employment for young people has been a feature of India’s economy over the past two decades. An obvious data point in this regard is the divergence in unemployment rates between young people [15-29 years] and for all ages. For young people, in the time period July-September 2023, the unemployment rate was 17.3 per cent. For all ages [15 and above], the unemployment rate was 6.6 per cent. That is, the young person is almost three times less likely to find work compared to the overall population.
This trend of high unemployment for young people has been a 21st-century phenomenon in India with no sign of abatement. In the time period 1999-2018, the youth unemployment rate tripled. Researchers, looking at this age cohort, have come up with a subgroup called NEET—not in employment, education or training—because it’s important to distinguish those who aren’t working for good reason from those who aren’t working with no reason to not work. The unemployment rate for this NEET group reached 44 per cent in 2018.
The other aspect of India’s employment numbers is that the largest section of workers—45.8 per cent according to the PLFS 2022-23 report—are working in agriculture. Given India’s abysmal yields, this is often disguised unemployment. So, not only are the young people looking for jobs not getting any, their parents and peers who work in agriculture are doing so often because they aren’t finding any other work.
Historically, a country with such high levels of youth unemployment has stared at revolution. This has been true from the French Revolution to the Arab Spring. Are the young people jumping into Parliament chamber with smoke canisters or those going to Nicaragua on a chartered plane to illegally enter the United States, warning us of such an eventuality? Time will tell. But in the meantime, perhaps the wealthy and the middle class would do well to not derisively call welfare programmes that help alleviate this pain for the young and unemployed “freebies”. Do not insult a growing and restless mob; it’s never a good idea to poke the bear.
Nilakantan RS is a data scientist and the author of South vs North: India’s Great Divide. He tweets @puram_politics. Views are personal.
(Edited by Prashant)