May 08, 2016

Where are the Jobs?

RECENTLY the corporate media has been discussing the problem of increasing joblessness and lack of employment growth in the country. This was, probably, sparked off by the Quarterly Employment Survey conducted by the Labour Bureau of eight employment intensive industries – textiles, garments, jewellery, IT, leather, handlooms, metals and automobiles – which showed that employment generated in these eight sectors was only 1.35 lakh in 2015, compared to 4.9 lakh in 2014 and 12.5 lakh in 2009. The situation is much worse as far as rural employment is concerned. With the declining contribution of agriculture to the GDP, there is no diversification of employment away from agriculture which can provide jobs to the rural poor and rural youth. Till the third week of March this year, 8.4 crore people applied for jobs under MGNREGS, showing the extent of rural unemployment. Narendra Modi and the BJP had made the creation of jobs on a large-scale, their main election promise during the Lok Sabha elections. But two years after the Modi government, the dismal record on the employment front stands out. Even though the government claims a GDP growth of 7.5 percent, which itself is a dubious claim, it is evident that this type of neo-liberal growth does not generate employment. As usual, the establishment economists and the corporate media analysts give various suggestions to stimulate the economy and to generate employment. But all of them miss the mark. The plain fact is that neo-liberal growth does not create but kills jobs. No amount of tinkering with the system will solve the problem of unemployment unless there is a basic change in policies. More reliance on private investment and privatisation will not generate employment. Because neo-liberal economics dictates that investment flow into the capital intensive, labour saving technology which will obviate the need for a large workforce. Further, the employment available will be on contractual basis, making jobs precarious and short term. Even in the informal sector which is the biggest provider of jobs in India, employment declined by 6 percent between 2004-05 and 2011-12. Thus the priorities of neo-liberal growth are not labour intensive industries nor the development of small-scale industrial units. Trade liberalisation lowered tariffs for industrial goods from abroad making domestic industry unviable which led to deindustrialisation in many sectors. Under neo-liberal policies, the government subsidises and foregoes taxes to the tune of thousands of crores for the big corporate and richer sections while it refuses to support the traditional industries like handloom, cashew, coir and handicrafts which provide livelihood and jobs to lakhs of working men and women. The cut in public investment in agriculture and the steep cuts in the social sector – education, health and MGNREGA – also contribute to the shrinking of employment potential in the country. What is required is an alternative trajectory of growth which will create employment in all sectors. There has to be big step up in public investment in agriculture and for infrastructure development as this will create jobs. Labor intensive industries, small-scale enterprises and agro-processing industries should be encouraged and incentivised. Substantial increase in public expenditure in the education and health sectors leading to expansion and qualitative improvement of the public education and health systems will generate employment. Along with this focused programmes for vocational and skill development for the youth will equip them for the diverse jobs which will open up. (May 4, 2016)