Job creation in India had always been a hotly debated issue as far as ameliorating unemployement and poverty in the country is concered. According to a World Employment and Social Outlook report that was recently released by the International Labour Organization (ILO), over the last 20 years, more of informal and vulnerable jobs have been created in the country. While talking about strong job creation in some ICT-intensive services, the report states that in India ‘a significant portion of the jobs created in the services sector over the past couple of decades have been in traditional low value added services, where informality and vulnerable forms of employment are often dominant.’
While talking about the Vulnerable and informal forms of employment, the report states that in India, the share of informal employment has risen within almost all manufacturing industries, partly as a result of labour market rigidities preventing modern manufacturing from creating employment opportunities. The report adds that the unemployment levels in the Asia and Pacific are expected to remain low relative to other regions, and constant over the forecast horizon at around 4.2 per cent. This is because employment growth in the region is expected to remain strong, with the number of employed persons projected to grow by some 23 million (or 1.2 per cent) between 2017 and 2019. Spotlighting a worrying trend, it states that vulnerable employment is on the rise and the pace of working poverty reduction is slowing.
The report highlights the fact that significant progress achieved in the past in reducing vulnerable employment has essentially stalled since 2012. This means that almost 1.4 billion workers are estimated to be in vulnerable employment in 2017, and that an additional 35 million are expected to join them by 2019. In developing countries, vulnerable employment affects three out of four workers.
ILO economist Stefan Kuhn, lead author of the report while explaining the same says, “In developing countries though, progress in reducing working poverty is too slow to keep up with the expanding labour force. The number of workers living in extreme poverty is expected to remain stubbornly above 114 million for the coming years, affecting 40 per cent of all employed people in 2018.”
Significantly, India’s economy, which is anticipated to expand by 7.4 per cent in 2018 (up from 6.7 per cent in 2017), is contributing to the pick-up in economic activity in Southern Asia. Real GDP in this region is projected to grow by 6.7 per cent in 2018 and by 7.0 per cent in 2019, up from 6.2 in 2017, according to ILO’s report.