In the build-up to the 2014 general election, Narendra Modi, the prime-ministerial candidate for the opposition Bharatiya Janata Party, rode on the promise of millions of jobs for youngsters. At a rally in Agra, in November 2013, he mocked the United Progressive Alliance government for not delivering on jobs. Five years on, as prime minister, he famously said, “If someone opens a pakora shop in front of your office, does that not count as employment? The person’s daily earning of Rs 200 will never come into any books or accounts. The truth is massive people are being employed.”
The National Commission of Statistics would perhaps answer Modi’s question with a no. In January 2019, PC Mohanan, the acting chairperson of the NCS, and his colleague JV Meenakshi resigned and publicly said that they were doing so because unemployment data was being concealed. It was widely speculated that the report was being delayed due to that year’s general election. Mohanan told India Today that the National Sample Survey—the first since demonetisation—was supposed to be released in December 2018 but, despite the NCS’s recommendation, had not been published yet. The report was kept under wraps and officially released only months after the election results were out. It revealed that India’s unemployment rate had risen to a 45-year high of 6.1 percent. Youth unemployment stood at astronomically high levels, between thirteen and twenty-seven percent. More disturbingly, people were moving out of the workforce in droves. This was before COVID-19 struck. In the April–June quarter of 2021, youth unemployment in urban areas was 25.5 percent.
During the pandemic, the drip of people opting out of the workforce turned into a flood. The labour force participation rate—the proportion of those of working age who are seeking jobs—was 47 percent in 2016 and sank even lower, to 40 percent, in December 2021. It is 68 percent in China and 58 percent in Bangladesh. For Indian women, the figure is even lower and among the lowest in the world, at around twenty percent. The low participation rate puts a veil on unemployment data, which only takes into account those seeking jobs and could, therefore, be much higher. Also, the very high numbers of agriculture workers and those in self-employed categories denote underemployment, rightfully called disguised unemployment.
After campaigning in 2014 on jobs and claiming to bring improvements in the material conditions of millions of Indians, the Modi government, through its policies and orientation, has rendered the picture grimmer. There are two aspects to this. The first is the destruction of the informal economy through demonetisation in 2016. The soul of India’s economic endeavours, whether for innovation, creation of jobs or enterprise, the informal sector was crushed by demonetisation and then nailed further into the ground with convoluted goods-and-services tax rules, which especially penalised micro and small-scale units—the very sectors that provided the bulk of employment to Indians. The economy is yet to recover from the destruction wrought in November 2016.
The Modi government’s tactic for its failure to create regular jobs is to hide behind the fig leaf of “self-employment,” but its pakora model is at odds with India’s reality and the dreams of its young. In 2015, Modi mocked the National Rural Employment Guarantee Scheme, the world’s largest public-works programme. The idea of developing sensible work-oriented programmes was minimised and questioned as a desirable goal. However, the Modi government not only continued the NREGS but also sanctioned additional funds for it. The scheme has helped sustain millions of otherwise unemployed workers during the pandemic.
COMMENT