Budget 2019 fails to address deepening jobs crisis : 06-02-2019

Even as India craves for jobs, Narendra Modi government’s last budget 2019 is largely seen to be silent on the matter, not having done much to create employment opportunities. For its part, jobs and employment have been a consistent theme of the NDA government’s last four budgets.

In his budget speech 2019, Finance Minister Piyush Goyal did not propose any new strategy to explicitly revive employment in the country. Moreover, the allocation for the Mahatma Gandhi National Rural Employment Generation Act (MGNREGA) was also cut to Rs 60,000 crore, which is lower than the revised estimate of Rs 61,084 crore for the current year. The amount allocated to self-employment schemes including MUDRA, Stand Up India and Start Up India is only Rs 515 crore.

Hashtag, how’s the jobs

Modi government’s apparent failure to create jobs has become a popular discourse across the nation, with the opposition parties drumming up the issue in most political rallies. Recently, a leaked report showed that unemployment in India had hit a 40-year-high of 6.1 per cent in 2017-18 according to the draft report of National Sample Survey. In the wake of this news, many expected that the government in its interim budget 2019 would focus on jobs and employment creation. However, the budget did little on this front.

According to the 2016-17 Economic Survey, manufacturing, is not growing in any state, barring a few, and is probably shrinking. On the other hand, the share of services has increased spectacularly to over half of GDP now from just 35% three decades ago. However, share of employment has not kept pace. This is because while sectors like transport and construction may be able to absorb the abundant low-skill labor, sectors like Banking, Financial services and Insurance (BFSI) and health care call for skills whose supply is limited.

Skill building

The answer may lie, in part, in being able to provide relevant skills to the people. The government’s 10 per cent reservation for the economically weaker section must be complemented with skill development to make people better equipped to carry out the jobs, Madan Sabnavis, CARE Rating’s chief economist, said to Financial Express Online. He added that employment generation is the most productive way of helping the poor.

Direct cash transfer, theoretically sound good, but identification and transferring the same could be a challenge as the low income population lacks access identity and bank account. Therefore, the government should focus on resolving these issues first, Madan Sabnavis said.

The issue of unemployment and job losses is of immense importance as Prime Minister Narendra Modi in 2014 had promised that his government would create 2 crore jobs every year. However, according to the Labour Bureau, number of jobs created stood at 1.55 lakh and 2.31 lakh for 2015 and 2016 respectively. Centre for Monitoring Indian Economy has recorded that around 11 million people lost their jobs in 2018.

Source : Financial Express