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India’s Deepening Employment Crisis in the Time of Rapid Economic Growth

Author

Listed:
  • Ajit K. Ghose

    (Institute for Human Development)

  • Abhishek Kumar

Abstract

The employment conditions in India were steadily deteriorating in the 2000s. Agriculture not just stopped accommodating new workers but was increasingly rendering many of the already employed workers—mostly less educated—redundant. Meanwhile, non-agriculture was generating employment at an increasingly slower pace and was also generating it basically for the educated. So, it was failing to absorb the labour moving out of agriculture. Under these conditions, progressive exclusion of the less educated from employment and decelerating employment growth of the educated emerged as the main trends, which showed up in declining employment rate, rising unemployment rate and, ironically enough, steady improvement in the average quality of employment. All this was happening in a period of rapid economic growth. The proximate explanation is that growth was less rapid than the skill-biased technological change that was associated with it. The deeper reason is that the benefits of growth accrued to a thin top layer of the population—the rich.

Suggested Citation

  • Ajit K. Ghose & Abhishek Kumar, 2021. "India’s Deepening Employment Crisis in the Time of Rapid Economic Growth," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 64(2), pages 247-279, June.
    • Handle: RePEc:spr:ijlaec:v:64:y:2021:i:2:d:10.1007_s41027-021-00314-0
    DOI: 10.1007/s41027-021-00314-0
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    References listed on IDEAS

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    4. Arvind Subramanian, 2019. "India's GDP Mis-estimation: Likelihood, Magnitudes, Mechanisms, and Implications," CID Working Papers 354, Center for International Development at Harvard University.
    5. Kapsos, Steven. & Bourmpoula, Evangelia. & Silberman, Andrea., 2014. "Why is female labour force participation declining so sharply in India?," ILO Working Papers 994949190702676, International Labour Organization.
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