Raghav JhunjhunwalaAIR 4 · CSE 2025 · 270 wordsTheir whole copy
Opening · a figure
The Employment Elasticity of output (1% change in Empl. / 1% change in GDP) has reduced from over 2.8% pre-2005 to below 1% today.
Body · points
How Jobless Growth has become a reality today:
Rising K/L (Capital-Labour) Ratio in our manufacturing process.
Only highly skilled sectors are providing more quality employment. Ex: Automobiles.
Increasing dominance of services sector which is less labour intensive services / GDP > 53% today
Increasing casualization and high disguised unemployment in urban and rural areas today.
How Labour-Intensive Industries can help:
(1) Sectors like Textiles, Footwear, Food processing Industries comparatively employ more labour than capital.
(2) Thus, along with more machinery; they don't substitute their labourers; rather the factors are complementary.
How Export Intensive Industries can help
(1) major chunk of our exports are contributed by MSMEs (>45%) → MSMEs have the potential to [be] the employment generators.
(2) Focussing on relatively untapped sectors: Ex: Phone Assembly → which is being captured by smaller countries like Vietnam; esp. because of China+1 diversification.
What are the pertinent challenges [Textiles]
(1) The Recently announced labour Codes have not yet been implemented.
(2) Lesser policy support to labour intensive sectors Ex:
- Footwear
- Accessories of textiles, etc.
(3) High Geographic concentration esp. in western coast
(4) Increasing labour costs and competition from cheaper producers like Bangladesh, etc.
way Ahead (1) Govt. has created PM-MITRA parks: as multi-modal; state of the Art hubs; to improve Economies of Scale and more export-orientation.
(2) PLI scheme has been announced.
→ Thus, focussing on such labour & Export oriented sectors have multiple benefits of employment and improved Economic performance.
Close · a way forward
None written.