India Sees A Surge In Educated Unemployed Youth: ILO

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India Sees A Surge In Educated Unemployed Youth: ILO

India Sees A Surge In Educated Unemployed Youth: ILO (Image: pixabay)

India has a huge challenge of harnessing the potential of demographic advantage. With a significant portion of the population in the working age bracket with increasingly educated youth, the Indian economy stands to gain from these numbers. However, this advantage is facing challenges as the youth population which is 27 percent of the total population in 2021 is expected to decrease even further.

The latest report published by the International Labour Organisation (ILO) reveals that in India higher educated young people are more likely to be unemployed than those without any schooling.

As per the data revealed, joblessness was 29.1 percent among graduates which is almost nine times higher than the 3.4 percent who cannot read or write. In younger people with secondary or higher education, unemployment was six times higher at 18.4 percent. ILO says that unemployment was predominant in youths with a secondary level of education or higher and intensified over time. A sharp mismatch was observed in the skills and the jobs being created in the market.

ILO underscores that the youth unemployment rates in India are now higher than the global levels. The Indian economy remained unsuccessful in creating enough remunerative jobs in the non-farm sectors for those educated and skilled workforce who are entering the labor market. The share of young unemployed Indians – aged 15 – 29- decreased by 5.9 percent in the last two decades while the share of educated youth increased by 11.5 percent, the ILO data revealed.

Other trends

One other important but similar observation made in India Employment Report 2024, is that nearly 83 percent of the jobless population belongs to the youth (aged 15-34). The report highlighted that the proportion of young educated people with at least secondary education doubled in the last two decades from 35.2 percent to 65.7 percent.

As per this report, more enrolment in higher education is seen but the quality and learning deficit exists. In this respect, former RBI governor Raghuram Rajan has warned of the adverse impacts of India’s poor schooling standards on its economy.

One more observation is the contrast between urban and rural joblessness was observed with higher unemployment in urban areas.

Educated female unemployment is also significant as they account for 76.7 percent of unemployed youths as compared to 62.2 percent of men. Female labour force participation has been dismal with only 25 percent employed.

The report also cautioned about the rise in gig jobs or temporary and low-paying employment, like food delivery drivers. Digital platforms have blurred the distinction between employees and self-employed individuals, creating new challenges for the well-being and working conditions of workers, ILO said.

It also shows that self-employment has been the chief driver of the Indian job market as out of the total employed 54.9 percent were self-employed, 22.8 percent were in regular employment and 22.3 were in casual employment.

What other reports reveal?

Similar observations were made by D. Tripati Rao of IIM, Lucknow in a joint study with BITS Pilani. The study said that low female participation and a rise in the unemployment rate with education level are the two most significant structural issues of the Indian economy. The study points to a surge in output growth and employment from 1987-88 to 2004-05, followed by ‘jobless growth’ from 2004-05 to 2018-19 and a subsequent trifling rebound.

The study reveals, “The number of unemployed people declined from 26.4 million in 2019–20 to 24.3 million in 2020–21 in India, while an additional 119 million people were not added to the potential labor force during the same”.

The latest report released just ahead of the parliamentary elections is a blow to the current government as the common youth is asking to ensure accountability from the ruling party during elections.

 

However, on one hand where youth is asking for the accountablity from the ruling government, the Chief Economic Adviser V Anantha Nageswaran challenged the idea that government intervention can solve all societal and economic problems, especially when it comes to tackling unemployment.