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Structural Changes in Employment in India, 1980-2011

Author

Listed:
  • K L KRISHNA

    (Department of Economics, Delhi School of Economics, University of Delhi)

  • SURESH AGGARWAL

    (Department of Business Economics, University of Delhi, South Campus)

  • ABDUL A ERUMBAN

    (The Conference Board and University of Groningen)

  • DEB KUSUM DAS

    (Department of Economics, Ramjas College, University of Delhi)

Abstract

The paper documents the growth of employment and the structural changes in Indian economy during 1980-2011 period using India KLEMS database version 2015. Issues related to labor quality have also been documented and analyzed. We observe that employment grew at 2.1 percent per year during 1980-1993 but it fell to 1.6 percent during 1994-2002 and further to just 1 percent during 2003-2011. The growth in persons employed during the entire period of study, 1980-2011 is led by construction and the services sector, possibly due to less labor regulations, followed by the secondary sector-consisting of manufacturing, electricity; gas and water supply and then agriculture. There has been a structural shift of employment from agriculture to construction and services, especially market-based services. The plausible reasons for slow growth in employment have been low labor force participation rates, especially by females, low labor intensity, and use of high capital intensive technology in production. The quality of labor in India is characterized by the poor among the employed, low share of persons employed with skills (employed persons with education level “above higher secondary” was only 10.2% in 2011 in the total economy), low growth rate in educational attainments, high proportion of persons employed as casual labor and a very high share of unorganized sector employment. Though the Indian economy is supposed to enjoy the fruits of demographic dividend and achieve high growth rates but the recent trend of falling employment elasticity (just 0.07 during 2003-2011) paints a very disappointing employment scenario. Even the sustainability of the service sector to provide jobs in future is in doubt because of its falling employment elasticity in recent years.

Suggested Citation

  • K L Krishna & Suresh Aggarwal & Abdul A Erumban & Deb Kusum Das, 2016. "Structural Changes in Employment in India, 1980-2011," Working papers 262, Centre for Development Economics, Delhi School of Economics.
    • Handle: RePEc:cde:cdewps:262
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    References listed on IDEAS

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    Cited by:

    1. Bhattacharya, Tulika & Bhandari, Bornali & Bairagya, Indrajit, 2020. "Where are the jobs? Estimating skill-based employment linkages across sectors for the Indian economy: An input-output analysis," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 292-308.

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    More about this item

    Keywords

    employment; labor quality; education; employment elasticity;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General

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