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Article

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Despite impressive achievements since 1991, India is facing several major challenges. A major problem is absorbing its youth in a productive labour force and finding gainful employment for them. Half of its population is under the age of 25. Only 35 per cent of the working age population has a job while 12 million new entrants would enter the labour force every year. The past record in labour absorption, despite impressive economic growth, has not been stellar. The great divide between the organized and unorganized parts of the economy is growing. Ninety per cent of the jobs are in the informal sector; although the share of agriculture in GDP has declined to 14 per cent, it still employs 45 per cent of the work force – indicating disguised unemployment and underemployment. If agtech becomes successful, the pressure on rural labour markets is likely to intensify. New technologies that are now being used in the modern sector are labour displacing. Entrants to the job market are joining the non-agriculture unorganized sector where the wages are a fraction of the wages in the organized sector. The unorganized sector also acts as a reserve army of labour, keeping organized sector wages in check. The organized sector employing contract labour rather than permanent labour has repercussions on productivity and competitiveness.

Publication Source

The News

Publication Date

9-16-2022

Pages

1-2

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