AGENCIES
NEW DELHI
An official survey that has been withheld by the government shows India’s unemployment rate rose to a 45-year high during 2017-2018, the Business Standard newspaper reported on Thursday, delivering a blow to Prime Minister Narendra Modi just months before what is expected to be a closely fought general election.
A political controversy over the survey erupted after the acting chairman and another member of the body that reviewed the jobs data resigned, saying there had been a delay in its scheduled December release and alleging interference by other state agencies.
The assessment by the National Sample Survey Office conducted between July 2017-June 2018 showed the unemployment rate stood at 6.1 per cent, the highest since 1972-73, the newspaper reported.
That year, when India was just coming out of a war with Pakistan and hit by global oil shocks like other oil-importing countries, the unemployment rate was 5.18 percent.
Congress president Rahul Gandhi said the job report showed “a national disaster”.
India’s economy has been expanding by 7 per cent plus annually – the fastest pace among major economies – but uneven growth has meant that there are not enough new jobs to keep pace. And critics say the government’s claims of economic success have sounded increasingly hollow.
Modi’s ambitious Make-in-India project to lift the share of domestic manufacturing from 17 per cent of GDP to about 25 per cent and create jobs for an estimated 1.2 million youth entering the marker failed to take off.
The report showed frighteningly high levels of unemployment among the young, with 18.7 per cent of urban males aged between 15-29 without work, and a jobless rate of 27.2 percent for urban females in the same age group.
Worse, the labour force participation rate – the proportion of population working or seeking jobs – declined to 36.9 per cent in 2017/18 from 39.5 per cent in 2011/12, the report said.
Himanshu, an associate professor at New Delhi’s Jawaharlal Nehru University who specialises on development economics, said the jobs crisis was everywhere to see.
“News and data like thousands of PhDs applying for waiter jobs in Mumbai or millions applying for just a thousand jobs in Gujarat or 10 million applying for a small number of jobs in Railways,” he said.
The data provides the first comprehensive assessment of India’s employment since Modi’s decision in November 2016 to withdraw most of the country’s banknotes from circulation overnight.
After the chaotic launch of a national sales tax in July 2017, hundreds of thousands have lost jobs in small businesses.
However, Niti Aayog vice-chairman Rajiv Kumar, who had previously mounted a defence of lowering of UPA-era GDP growth rates, at a press conference on Thursday said the report cited by the newspaper “is not finalised. It is a draft report”.
Refusing to comment on the content of the news report, he said the government will release its employment report by March after collating quarter-on-quarter data.
He also debunked claims of jobless growth, saying how can a country grow at an average of 7 per cent without employment.
Niti Aayog CEO Amitabh Kant, who too was present at the conference, said India is creating adequate number of jobs for new entrants, but “probably we are not creating high quality jobs”.
The gloomy jobs data could be awkward for Modi government to explain with a general election looming and opinion polls already showing the ruling Bharatiya Janata Party unlikely to keep its parliamentary majority.
“It’s a very, very serious issue, and that is the reason why the government didn’t want this data to come out in the public domain,” said former Union finance minister Yashwant Sinha.
Interestingly President Ram Nath Kovind on Thursday described demonetisation as a defining moment in the NDA government’s war on corruption, adding that it had struck at the very root of the parallel economy which was thriving on black money.
Addressing the joint sitting of Parliament, Kovind said, “Demonetisation was a defining moment in the government’s war on corruption and black money. This decision struck at the very root of the parallel economy thriving on black money, and the money outside the formal system was brought within the ambit of the nation’s economy,” he said.
It is pertinent to note here that a report released by the All India Manufacturers’ Organisation said last month 3.5 million jobs had been lost since 2016, mainly due to demonetisation and rising working costs after the launch of the national tax.
Some sociologists say that there are instances of a correlation between high unemployment and an increase in criminal behaviour.
“The anti-social activities, they have risen in many places. Whether roadside violence, theft, robbery, black-marketing, prostitution, all kinds of things,” said Abhijit Dasgupta, professor of sociology at the University of Delhi.