India's Employment Landscape: Insights from the 2024 Report

Azim Premji University, FICCI, and TISS jointly unveil a new policy proposal addressing India's employment challenges, as highlighted in the 2024 report
India's Employment Landscape: Insights from the 2024 Report

The recently published India Employment Report 2024, the third installment in a collaboration between the Institute for Human Development and the International Labour Organization (ILO), delves into the intricacies of youth employment challenges within the framework of India’s evolving economic, educational, and skills landscapes over the last two decades. Here are the key takeaways from the report:

1. Labour Market Dynamics

India has witnessed paradoxical improvements in labour market indicators in recent years, following a prolonged period of deterioration from 2000-2019, which coincided with economic distress.

Concerns persist regarding the reversal of the slow transition to non-farm employment, the rise in self-employment and unpaid family work—particularly among women, stagnant or declining wages, and the quality of youth employment compared to adults.

2. Unemployment Trends

The unemployment rate exhibited a decline between 2019-2022 after a prolonged rise from 2000-2019.

States like Bihar, Odisha, Jharkhand, and UP continue to lag at the bottom of the 'employment condition index', while Delhi, Himachal Pradesh, Telangana, Uttarakhand, and Gujarat maintain their lead.

3. Employment Quality

Informal employment has witnessed a surge, with nearly half of formal sector jobs assuming an informal nature.

Self-employment remains the dominant source of work, accounting for 55.8% of employment in 2022.

The proportion of regular employment, associated with better job quality, declined to 21.5% in 2022, while casual employment, linked to poorer job quality, fell to 22.7%.

4. Women’s Labor Force Participation

India's female labor force participation rate (LFPR) remains among the lowest globally at 32.8% in 2022, significantly lower than men's.

Although female LFPR witnessed a decline from 2000-2019, there was a marginal rise from 2019-2022, yet it remains lower than the global average.

5. Sectoral Employment Shifts

The share of agriculture in total employment witnessed a decline from 60% in 2000 to approximately 42% in 2019, largely absorbed by the construction and services sectors.

However, this transition has stagnated or reversed since 2018-19, with manufacturing's share of employment remaining relatively stable.

6. Youth Employment

Youth employment and underemployment experienced an upward trend from 2000-2019 but saw a decline during the pandemic.

Unemployment rates are substantially higher among educated youth, particularly graduates, with a notable difference between genders.

7. Policy Recommendations

The report advocates for policies aimed at promoting job creation, enhancing employment quality, strengthening skills development, supporting MSMEs, and addressing inequalities in the labour market.

It emphasizes the importance of adapting to emerging sectors such as care and digital economies and providing job security and wage protections for gig/platform workers.

The report serves as a timely resource for policymakers, social partners, civil society, and researchers, offering valuable insights to inform strategic decisions in the years ahead.

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