Union Budget India 2019: Economic Survey of July 4, 2019 has well highlighted the critical urgency of job creation in large numbers, in view of the fact that working age population is expected to grow by 97 lakh annually over the coming decade.
A fisheye view of the impending job market challenges including current unemployment poses as a policy planner’s nightmare. Adding discomfort to this already bleak scenario are the recent observations, about likely anaemic GDP growth worldwide for the next few years, released post G20 finance ministries meet in Japan.
It is also noted that the well-intentioned schemes of Modi 1.0 such as Make in India, Skill India, Digital India, Startup India, Standup India etc failed to kick start both the potential economic promise as well as unbottling the job elixir. This fact that stands confirmed by PLFS report of NSSO, which however was termed as only a draft report by the government.
As regards job providing sectors such as textiles and apparel have both not done well (exports have risen marginally and if one evaluates from the job creation potential, it has been in a negative spiral). The automobile sector is spluttering into a major slowdown. The construction industry is experiencing the continuing downward trend as figures relating to Gross Value Added by this sector speak louder than words of hope.
They are in fact, at historical lows. Agriculture is already overburdened by engaging the work force, which results in low per capita yield. 90% of Mudra loans ticket size have been less than `50,000 and are thus incapable of creating new jobs.
The Economic Survey 2018-19 aims at increasing employment through creating a ‘virtuous cycle’ of savings, investment and exports. It, however, does not explain as to how the exports will increase in the present era of trade restrictions and tariff wars. Further, one has serious doubts about increase in savings in view of downward interest rate spiral and its impact on savings instruments. While industry and entrepreneurs welcome lower rate announcements by the RBI, the individual investor rues such moves.
Nirmala Sitharaman’s Budget did not talk of job creation as such but it did talk of Startup India, Standup India, Make in India, SFURTI, ASPIRE, Khadi Clusters and creation of 75,000 entrepreneurs in rural India. It talks of helping women SHGs by giving `5,000 to each member of SHG. Again, it is difficult to believe as to whether such an assistance will create jobs or even self-employment.
Earlier, economic growth and more jobs were interconvertible terms. Free market has failed the test of naturally creating more and more jobs as was believed. Job creation will only come from innovations and newer sectors. Alas, we have again missed both, the jobs and the related growth buses as far as manufacturing is concerned.
(The author is Ex-Chief Provident Fund Commissioner, EPFO)
Published On : 06-07-2019
Source : Financial Express
