INDIA BUSINESS WORLD - JUNE 2006
THE MONTH THAT WAS...

JOBS GROW FASTER THAN WORKFORCE

   JOBLESS growth is empty rhetoric, at least off the farm where the bulk of growth takes place. Off-farm jobs are growing faster than the workforce, finds the Fifth Economic Census, whose results were released by the government. Between 1998 and 2005, jobs in enterprises other than those engaged in crop production and plantations rose by 2.5% a year whereas the growth of the workforce is 2% a year. The growth in employment is an improvement over the fourth census rate of 1.7% a year during 1990-98, pointed out GK Vasan, minister of state for statistics and programme implementation. This shows an accelerating trend in job growth in the latter half of the reform years compared to the initial years.

The Economic Census, carried out by the CSO, is a complete count of all entrepreneurial units in the geographical boundaries of the country and is more reliable than any sampling exercise. The first such exercise was undertaken in 1977.

The critics of reforms still have something to cheer about. Data released by the government show that despite all efforts, crop production and the plantation sector still employs 73% of the total labour force of the country of 375 million. A shade under 100 million workers are employed in industrial and services sectors of the economy. But the bad news is that the urban sector has been lagging behind the rural areas in job creation. Fifty-one per cent of total employment in non-agricultural jobs are in rural areas and 49% in urban. And rural India has created 61.3% industrial and service sector units with urban India accounting for only 38.7% between 1998 and 2004. Since such units tend to employ less than 10 workers, hired workers constitute only 52% of the total nonagro workforce in the country.