State of Working India Report

Context:

• A recent report by Bengaluru-based Azim Premji University, titled “State of Working India 2023: Social Identities and Labour Market Outcomes,” found that there is a large variation in unemployment rates among people with higher education, even though post-COVID figures are lower than pre-COVID levels.

Key Findings of Report:

• Labour Market Scenario:
  • Post-pandemic, 42% of graduates under 25 were unemployed. 
  • The main reason is the global economic slowdown caused the pace of job creation to decrease.
  • The unemployment rate falls from over 40% for educated youth under 25 years of age to less than 5% for graduates who are 35 years and above” (Refer-Image).
• Correlation between Economic growth and Job Creation:
  • The report found that, since the 1990s, there has been no correlation between year-on-year non-farm GDP growth and non-farm employment growth. 
  • This means that policies that promote faster economic growth may not necessarily lead to faster job creation.
  • However, the report also found that, between 2004 and 2019, on average, economic growth did translate to decent job creation. This trend was interrupted by the COVID-19 pandemic, which caused a larger growth in distressed employment.
• Informal Sector Main Driver in Job Creation:
  • The report found that the Indian economy has grown rapidly since the 1980s, and this growth has drawn millions of workers out of agriculture. 
  • However, the report also found that the manufacturing sector has not grown its share of GDP or employment significantly. Instead, the construction and informal services sectors have been the main job creators. 
  • It also highlighted the proportion of salaried or regular wage workers has also increased, while the proportion of casual workers has decreased.
• Gender Wage Gap:
  • According to the report, the gender-based earnings gap in India has narrowed over the past decades, but it has remained constant since 2017. 
  • In 2004, salaried women workers earned 70% of what men earned, but by 2017 this had increased to 76%. However, the gap has not changed since then.

Source: Live Mint