Vol. XL No. 44 October 30, 2016

Jobless in Modi Raj

INDIA is facing a deepening crisis on the employment front.  According to a new Employment-Unemployment (EU) Survey conducted by the Labour Bureau, unemployment in India is running at a five year high of 5 percent of the workforce who are fifteen years and above.  Over a third of the people at work are employed for less than a year. Based on the Census 2011 figures, 5 percent of those above fifteen years would work out to 2.3 crore persons;  further, 35 percent underemployed would mean nearly 16 crore persons.

This latest survey confirms the trend of another Labour Bureau survey of employment in industries.  The bureau does a quarterly survey of employment trends in eight employment intensive sectors – textiles, leather, metals, autos, gems and jewellery, transport, information technology and handloom and power looms.  In the report covering the July-September 2015 quarter, the survey found only 1,34,000 jobs were created.  This is much lower than the three lakh jobs created every quarter between 2009 to 2011.

The inflated GDP growth rate claimed by the Modi government is only leading to jobless growth.  This is evident from the fact that between 2012-13 and 2015-16, for every one percent increase in GDP, jobs grew only by 0.20 percent.

The failure to create jobs is the single biggest failure of the Modi government so far.  The BJP in its election manifesto had promised to produce one crore new jobs for the youth annually for the next five years.  Modi’s pet slogan of `Make in India’ is fast proving to be a hollow one.  Public investment has hardly picked up notwithstanding the exaggerated claim of the finance minister in this regard.  Private sector investment remains very low. Industrial production has been falling steadily with the index of industrial production falling in the two consecutive months (year on year) of July and August by 2.5 percent and 0.7 percent. 

The policies of the Modi government are contributing to the stalling of employment growth.  Over the last three budgets, real outlays of the central government have not grown even to the extent of GDP growth.  Government’s spending as a share of GDP has been coming down, thus impacting negatively on demand and job creation.  The Modi government cut outlays on MNREGS and rural development in the first two years.  It increased indirect taxes (which boost the rate of growth artificially when GDP is calculated at market prices as being done now). Both these factors have limited the growth of purchasing power of the masses whose demand is more for labour intensive goods as compared to the rich. 

The Modi government’s neo-liberal response is to blame the rigid labour laws for curbing employment growth. Instead of job creation, it is now set upon removing all labour and employment friendly provisions in the labour laws and replacing them by draconian anti-labour provisions.  

Coupled with the agrarian crisis, the rising unemployment is leading to mass discontent and social tensions which have erupted in the form of agitations by Patidars in Gujarat, Jats in Haryana, Marathas in Maharashtra and Kapus in Andhra Pradesh demanding reservation in jobs and education.  These are all symptoms of how little productive employment is being generated leading to demands on the only secure jobs available in the government sector.

It has become imperative, therefore, to fight against the job killing policies of the Modi government and to demand putting in place alternative policies which can generate employment by reviving agricultural growth, increase demand in the economy and spur the development of labour intensive industries. 

(October 25, 2016)