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8.4 m jobs added in 2.5 yrs

8.4 m jobs added in 2.5 yrs

Author: BS Economy Bureau in New Delhi
Publication: Rediff on Net
Date: January 20, 2004
URL: http://us.rediff.com/money/2004/jan/20jobs.htm

The rate of employment generation in the country has gone up from an average of 1.07 per cent between 1994 and 2000, to 2.04 per cent between 1999-2000 and December 2002. The rise has been more in the urban areas as compared to the rural ones.

Figures released by the National Sample Survey Organisation show that on an average 8.4 million jobs have been added over the 2.5-year period.

The Tenth Five-Year plan aims to generate 10 million employment opportunities each year.

"The shortfall in employment generation is because of the lower than expected growth. Delay in certain policy changes have also hampered employment creation. However, now, that recovery has started, we are likely to achieve the targeted employment generation figures," said SP Gupta, member Planning Commission.

The usual principal status indicates that the employment situation in the country had improved considerably, he added.

The additional employment in the 1999-2000 to December 2002 period has come from the small scale sector, Gupta said, adding that in contrast, the corporate sector had shed around 1 million jobs, in the previous year.

Traditionally labour intensive sectors, like construction, big projects like dams are highly mechanised, resulting in a sharp drop in the number of employed.

There is, therefore, a need to focus on the small-scale sector and on demand driven vocational training, he added. There are a minimum of 8.4 million class 10 drop-outs in the country each year and the formal educational system can absorb less than half of them, underlining the need for vocational education.

Also, current statistics show that abbot 70 to 75 per cent of students coming out of vocational training institutes do not get placements. This is an indication of the lack of market focus in the training.

The figures on employment growth are however based on the UPS, which only measures open unemployment in the economy.

"This type of unemployment is limited to urban areas, and is not correlated with poverty," say economists.

These figures are not strictly comparable with the plan figures and even with the 1999-2000 figures, which are based on the current daily status of unemployment, which measures both unemployment and underemployment.

Given the seasonal nature of employment in agriculture, underemployment is a big problem in the country and is also highly correlated with levels of poverty.

The NSSO, which churned out CDS employment figures every five years, has been asked to conduct 6 monthly surveys on CDS employment to help monitor the employment situation in the country.

The first of these bi-annual surveys would be out in May 2004.

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