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India, the land of rising unemployment

There is one word that seems to be missing from much of the debate and discussion on current economic issues these days. The word is 'employment.'

Economic analysts frequently discuss various aspects of globalisation, liberalisation, privatisation, divestment and so on. How come so few seem to talking about a topic that used to dominate the discourse on economics in India not very long ago?

Prime Minister Atal Bihari Vajpayee did mention the need to create more jobs during his Independence Day speech from the capital's Red Fort. But there was not much in his speech by way of a clear-cut strategy as to how these new jobs would be created.

The fact of the matter is that the employment scenario in the country right now is pretty bleak and becoming worse by the year. One does not have to search very far but look at the official Economic Survey to confirm one's worst apprehensions.

The most recent figures in the survey pertain to the year ended March 31, 2000 and these statistics of employment have been compiled by the directorate general of employment and training in the ministry of labour.

The total employment in the public sector came down for the fourth year in succession: from 19.56 million in 1996 to 19.42 million the following year, a little lower the year after that to 19.31 million in the year 2000.

If you thought the loss of jobs in the public sector was being compensated by growth of employment opportunities in the private sector, you would be sadly mistaken. The figures of employment in the organised private sector are equally dismal.

Total employment in the private sector came down from 8.75 million in 1997 to 8.69 million the following year and 8.65 million in 2000.

The only saving grace, if at all it can be called that, is that more men have lost their jobs than women. So much for gender equality!

Between 1994 and 2000, employment in the public sector declined in absolute terms by 0.03 per cent while employment in the private sector grew by a niggardly 1.87 per cent.

These figures, incidentally, relate only to the organised sector that accounts for less than 10 per cent of the total employment in the economy.

What has taken place for the first time in the country is that the absolute number of persons engaged in agriculture has declined, the survey has stated.

The ironical aspect of the employment situation in India is that job opportunities were growing at a much faster rate when the country's population was also growing at a relatively fast pace.

Thus, between 1981 and 1991, India's population grew at 2.14 per cent per year, while the annual rate of growth of population between 1991 and 2001 was only 1.93 per cent, the lowest since the country became politically independent.

According to the Planning Commission, whereas overall employment grew by 2.43 per cent per annum between 1987-88 and 1993-94, the rate of growth of employment had slumped to barely one per cent between 1993-94 and 1999-2000.

Should one be surprised then that phrases like 'economic liberalisation' or 'second-generation reforms' fail to excite those outside the corridors of chambers of commerce and apex industry associations like the Confederation of Indian Industry and Federation of Indian Chambers of Commerce and Industry?

The Planning Commission had set up a task force under the chairmanship of the commission's former member Dr Montek Singh Ahluwalia to suggest strategies to create jobs for ten million people each year for the next ten years.

The panel's report was couched in generalities galore. For instance, the first 'major area' for employment generation was to accelerate the rate of growth of gross domestic product with 'particular emphasis on sectors likely to ensure the spread of income to the low income segments of the labour force.'

A first year student of economics could have told you the same thing. Be that as it may, last year, Defence Minister George Fernandes (shortly before he resumed his post after a brief period in the wilderness, post-Tehelka) had flayed the Ahluwalia panel report at a public meeting organised by the Swadeshi Jagaran Manch.

Meanwhile, Ahluwalia moved to Washington to join the International Monetary Fund while the Union government set up another task force to look into the same issue, this time under the chairmanship of Dr Shyama Prasad Gupta, also a member of the Planning Commission.

The Gupta panel's report was recently released and it has made a host of suggestions to improve the employment scenario. One suggestion is to continue the system of exclusive reservation of the manufacture of certain products for small-scale enterprises.

This suggestion is, of course, staunchly opposed by bodies like the CII and FICCI, that - by and large - represent the interests of big business.

These organizations argue that reservation for the small-scale sector inhibits the country's competitive potential in the global marketplace and prevents enterprises from reaping the benefits of economies of scale through a reduction in production costs.

Those who advocate a 'small is beautiful' philosophy, on the other hand, contend that only by encouraging small enterprises can there be hope of fulfilling the goal of increasing job opportunities in the economy. The debate goes on.

For some years now, the issue of whether or not to continue the policy of reservation for the small sector has been hanging fire. When last heard of, a committee headed by Deputy Prime Minister L K Advani was yet to finalise its views on the contentious subject.

Like the Ahluwalia task force, the Gupta committee's report is filled with homilies and statements of intent with which few can have any exception. Unfortunately, the reality on the ground is rather grim.

What is worse, this phenomenon of a jobless future is not confined to India, but is an alarming global trend. As more and more entrepreneurs talk of lean production, re-engineering, total quality management and 'decruiting,' workers are becoming increasingly uncertain about the future.

In his book, End of Work (Penguin, 2000), author Jeremy Rifkin has detailed instances of how young people the world over are giving vent to their frustration and rage by anti-social behaviour while older individuals, 'caught between a prosperous past and a bleak future,' feel trapped by social forces over which they have little or no control.

"While earlier industrial technologies replaced the physical power of human labour, substituting machines for body and brawn, the new computer-based technologies promise a replacement of the human mind itself, substituting thinking machines for human beings across the entire gamut of economic activity," Rifkin has written.

Life, as we know it, is being altered in fundamental ways, he has added. Millions the world over had placed their hopes for a better tomorrow on the liberating potential of the computer revolution.

Yet, as Rifkin points out, the truth is that in India and the world over, the economic fortunes of most working people continue to deteriorate amid the embarrassment of technological riches the benefits of which reach only the elite.

The author is Director, School of Convergence @ International Management Institute, New Delhi and a journalist with 25 years of experience in various media - print, Internet, radio and television.

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