Urban Unemployment in India | UPSC

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IASbhai Daily Editorial Hunt | 15th Sep 2020

Believe you can and you’re halfway there.– Theodore Roosevelt

Dear Aspirants
IASbhai Editorial Hunt is an initiative to dilute major Editorials of leading Newspapers in India which are most relevant to UPSC preparation –‘THE HINDU, LIVEMINT , INDIAN EXPRESS’ and help millions of readers who find difficulty in answer writing and making notes everyday. Here we choose two editorials on daily basis and analyse them with respect to UPSC MAINS 2020.

EDITORIAL HUNT #138 :“Urban Unemployment in India | UPSC

Urban Unemployment in India | UPSCUrban Unemployment in India | UPSC

M. Suresh Babu | Sai Chandan Kottu
Urban Unemployment in India | UPSC

M. Suresh Babu is Professor and Sai Chandan Kottu is pursuing development studies, respectively, at the Department of Humanities and Social Sciences, IIT

      HEADLINES:

Urban employment as the focal point

      CENTRAL THEME:

Given the structure of the economy and demographic profile, the vulnerabilities of informal jobs must be addressed

SYLLABUS COVERED: GS 3 : Unemployment : Trade

      MAINS QUESTION:

Vulnerable employment in the Urban spaces has turned down into massive large scale migration after lockdown . Comment -(GS 3)

      LEARNING: 

  • Job pressure and unemployment
  • Challenges
  • Policy intervention

      INTRODUCTION: 

The contraction of the economy raises concern on the employment situation as the shrinking sectors are those that create the maximum new jobs.

  • SCHEMES DO NOT SUBSTITUTE JOBS : While the ‘Garib Kalyan Rojgar Abhiyaan’ launched in June could be an immediate relief, the ₹50,000-crore employment scheme cannot be a substitute for decent urban jobs.
  • FOCUS : Given the structure of the economy and demographic profile, it is important to focus on reducing the vulnerabilities of urban informal jobs in the long run.

      BODY: 

ECONOMY AND EMPLOYMENT

  • RECENT DATA : The shrinking sectors : — construction (–50%) other services (–47%), manufacturing (–39%), and mining (–23%) — are those that create the maximum new jobs !
  • CONTRACTING ECONOMY : In a scenario where each of these sectors is contracting so sharply; People are losing jobs or failing to get one, or even both.
  • REVERSE MIGRATION : This sharp contraction has witnessed a wave of massive ‘reverse migration’ during the early phase of the lockdown
  • MISSED CITY TRAINS : It would not be unreasonable to assume that a majority of workers might not go back in the near future.
  • INFORMAL JOBS : The abrupt announcement of the lockdown exposed the vulnerabilities of urban low-end informal jobs .

VULNERABLE EMPLOYMENT : Vulnerable employment is characterised by inadequate earnings, low productivity and difficult conditions of work that undermine the basic rights of workers.

  • HIGH INFORMALITY : They are more likely to be informally employed and lack effective representation by trade unions.
  • ILO’s TAKE : According to the International Labour Organization, of the 535 million labour force in India in 2019, some 398.6 million will have poor quality jobs.

WORKING POORS : The poor quality of jobs and high informality are key for the high level of “working poors” or those living on incomes of less than ₹198 in a day.

  • POVERTY RATES : Thus, despite higher economic growth in recent years, working poverty in India also remains high.
  • SIGNIFICANT DIP : Given the contraction and lack of demand in the economy, there is a significant dip in urban employment generation.

CHALLENGES IN POLICY INTERVENTIONS

  • To generate more jobs and
  • Second, to reduce vulnerabilities by providing decent wages and some form of job security.

SITUATION IN INDIA

  • STRUCTURAL REFORMS : The high and persistent incidence of vulnerable employment are a reflection of the nature of the structural transformation process.

LOW VALUE ADDITION JOBS : India presents a curious case in this regard as capital and labour are moving from low value-added activities in a sector to another sector.

  • POOR QUALITY JOBS : This leads to a situation where a large proportion of the jobs being created is of poor quality .
  • SERVICE SECTOR BOOM : This has strong job creation in some Information and Communication Technology (ICT)-intensive services.
  • THE URBAN POOR : The pandemic and associated policy responses have exposed the vulnerability of these urban jobs.

STEPS TO TAKE

  • MULTI DIMENSIONAL APPROACH : The present crisis calls for a multi-pronged strategy to tackle the issue of urban jobs.
  • A SCHEME : The focus on urban employment generation programmes should be in coordination with local governments.
  • RESOURCE ALLOCATION : As these problems are daunting, actors at the local level need to have more resources at their disposal.
  • RESOURCE MOBILISATION : This could be enabled by the formation of local alliances, involving trade unions, entrepreneurs and community groups.
  • INVESTMENT POLICY : A major local initiative would be to design and implement employment-intensive investment policies.
  • PRIVATE PLAYERS : These policies should embrace the initiatives of both private entrepreneurs as well as by the government.

Private investments need to be facilitated by conducive contractual relations between labour and capital.

  • PRODUCTIVITY ENHANCEMENT : Enterprise formation needs to be an integral part of the strategy.
  • SMALL AND MICRO ENTERPRISES : The fulcrum of industrialisation, need extra support to balance the interests between labour and capital as neither have collective bargaining powers.
  • URBAN INFRASTRUCTURE : This would be to prioritise urban infrastructure as it accounts for a large share of total investments in the local economy.

INVEST IN INFRASTRUCTURE

  • URBAN DWELLERS : However, much of these investments rarely benefit poor urban dwellers as housing, roads, sewerage and water systems are inadequate for their needs.
  • APPROACH : A labour-intensive approach to building municipal infrastructure can be a cost-effective alternative to capital intensive-approach as wage rates are low.
  • INFRASTRUCTURE INVESTMENTS : This would spur employment, generate earnings and contribute to small enterprise formation.

HOUSING : Construction of low-cost housing is another activity that can be carried out using labour-intensive methods.

  • HEALTH-INFRA :The fourth element could be an immediate launch of an urban employment scheme oriented toward building large-scale medical, health and sanitation infrastructure in cities .
  • MEANINGFUL INTERVENTIONS : Other immediate employment generation can be to expand networks of essential services as a part of welfare interventions of State and local governments.
  • QUESTIONABLE DECENT LIVING : The capacity of our rural economy to absorb workers who returned from cities is low.

      IASbhai Windup: 

ONLY NREGA IS NOT ENOUGH

  • CURRENT CIRCUMSTANCES : Mahatma Gandhi Employment Guarantee Act (MGNREGA) or its substitutes can absorb a significant proportion of these workers.
  • EXPANSION : It is important that MGNREGA be expanded by both increasing the budgetary allocations and the guaranteed minimum number of days of work.
  • STRENGTHENING MGNREGA : Rural jobs schemes have to be strengthened and their capacity increased, but only a portion of the workforce might be accommodated in it.

But finally ,Generating decent urban jobs looks to be the only way out.

       SOURCES:   THE HINDU EDITORIAL HUNT | Urban Unemployment in India | UPSC

 

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