NEW DELHI: India’s unemployment rate currently stands at approximately 7.95%, with a higher concentration in urban areas at 7.93% compared to 7.44% in rural regions, according to the centre for Monitoring the Indian Economy (CMIE).
India, the world’s most populous country since May 2023, is grappling with a severe unemployment crisis that threatens its demographic dividend and challenges its economic aspirations.
Despite the emergence of bi-monthly job fairs as a potential solution, a mere 10% of the roughly 1,000 attendees manage to secure employment. The lack of enthusiasm among both recruiters and job seekers is palpable. Recruiters often lament the low skills and mediocre qualifications of attendees, primarily recent college graduates.
India’s youth, constituting a significant 66% of its population under the age of 35, was expected to be the driving force behind the nation’s progress. Paradoxically, they are the most affected by the prevailing joblessness in the current economic climate.
Growing Unemployment in India
The issue of unemployment has grown progressively worse over the last two decades, escalating from 2% in 2010 to 5% in 2015 and reaching 6.1% in 2018. The latest CMIE figures indicate an alarming 8%, marking the highest rate ever recorded.
The crisis is most dire among young people, with a staggering 40% facing joblessness, particularly recent college graduates from smaller cities who hold degrees in fields like agriculture, history, English, philosophy, and communication.
The magnitude of the crisis was highlighted by the startling statistic that between 2021 and 2022, a staggering 18.7 million individuals applied for central government jobs, with only 38,850 being successfully hired, resulting in a dismal success rate of 0.2%. This dire situation forced even those with doctoral degrees, engineering qualifications, and MBA graduates to compete for positions such as street-sweepers and police orderlies, roles that require only a fifth-grade education.
Political implications and strategies surrounding employment have further complicated the issue. In 2019, the government clamped down on news regarding an all-time high unemployment rate that had leaked ahead of general elections.
Indian academic Amit Basole says: “They announce government vacancies only before elections. This is the politics of unemployment, in which the government approaches unemployment as an electoral rather than developmental issue and strategically times announcements of recruitment drives and job reservations for electoral gain.
In 2021, discontent among army applicants erupted as the government transformed army positions into four-year contractual roles under the Agniveer scheme.
Amid this grim landscape, there have been promises of economic rejuvenation. Prime Minister Narendra Modi inaugurated a Global Investors Summit in Uttar Pradesh (UP), which reportedly attracted investment proposals worth over 32 trillion rupees (approximately $396 billion) with the potential to generate 9.2 million jobs in the state.
Additionally, Mukesh Ambani, one of India’s wealthiest individuals, announced plans for his Reliance group to invest an additional 75 billion rupees ($916 million) over the next four years, potentially creating 100,000 jobs for the country’s youth.
However, skepticism looms over these ambitious proposals, as past glitzy bilateral deals and investor summits have often fallen short of effecting tangible change.
Youth unemployment in India stands as a ticking time bomb, with almost a third of the country’s youth not working, studying, or undergoing training, as reported by the World Bank.
The urgency of the situation necessitates a candid acknowledgment of the scale and depth of this crisis.
As they say: “If you want to destroy a country, destroy its youth — the country will automatically be destroyed”. Sooner or later, this seems to be true in the case of India.
According to a recent Bloomberg report citing CMIE data for July, the overall unemployment rate in India remains at 7.95% as of July 2023.
A series of events, including the global financial crisis (2008-2009), the demonetization (2016), the introduction of the Goods and Services Tax (2017), the Covid-19 pandemic (2020), and persistent inflationary pressures, have contributed to the worsening unemployment situation. These events have resulted in economic slowdowns, disruptions in various sectors, and increased joblessness, making unemployment one of India’s most pressing challenges.
