Ministry officials attribute the trend to not just slowdown impact, but modernisation of exchanges in many states such as Maharashtra, Haryana, Karnataka and Tamil Nadu, along with special schemes like unemployment allowance announced by Uttar Pradesh which may have increased enrolment.
Hardly 5% of job seekers enrolled in employment exchanges got placed in 2012.
As per the data, the number of job seekers registered with 956 employment exchanges and employment information and guidance bureaus across various states rose to 97.22 lakh in 2012 from 62.06 lakh in 2011. Enrolments at employment exchanges had been falling between 2007 and 2008 when the economy was growing at over 9% but it started rising after the Lehman Brothers collapse and subsequently European debt crisis slowed economic activities in India, along with a domestic policy-paralysis that thwarted productivity-enhancing reforms.
Placement aided by employment exchanges fell 9.3% to 4.28 lakh in 2012 from 4.72 lakh in 2011. Placements fell 7.5% in 2011 from 5.1 lakh in 2010. Due to low placement rates, the number of job seekers listed on employment exchanges is a staggering 4 crore now.
Of course, employment exchanges have lost some of their utility in the recent decades as most job seekers directly apply for jobs in private and public sector companies. Moreover, most of the jobs on offer in recent years are on contract.
In recent years, many private companies have cut jobs to protect their profit margins as demand slowed in Asias third largest economy.
The government is trying to revive employment exchanges through modernisation and structural reforms. The government has plans to amend the Employment Exchanges (Compulsory Notification of Vacancies) Act to revamp employment exchanges and turn them into employment guidance and promotion centres, and focus on vocational guidance and career counselling, apart from their role of registration, submission and placement centres.