|
Suddenly, employment concerns
are back on the political and policy agenda. For more than a decade
now, economic policy discussion in India had relegated employment generation
to a subsidiary position, instead emphasising "efficiency"
and "productivity growth" as the primary aims of government
economic policy. In the process, neglect by official policy combined
with the other side-effects of the economic strategy to create a situation
of relative stagnation of employment, which has now once again become
a matter of public concern.
Thus, recently Prime Minister Vajpayee
has expressed concern at the inadequate generation of productive employment
in the country. Of course, he then ascribed the high levels of underemployment
as reflective of the combination of technological change and population
explosion, an explanation which is weak at best in terms of explaining
recent trends in employment and unemployment. But in general this is
reflective of a new attention in policy-making circles being granted
to the issue of employment. At one level this is no more than a belated
recognition that this area is not simply one which can be left to "just
grow" on its own, which was the official attitude of the past decade.
The 1990s - the decade of "economic
reforms" - was heralded by neo-liberal economists as a period which
not just produce higher growth rates, but also involve a more general
unleashing of productive forces leading to faster employment generation.
Since there is no question that inadequate employment growth has been
one of the major lacunae in the entire post-Independence development
experience, this was obviously seen as a very desirable outcome, although
the links were never really very carefully developed in the argument.
Thus, the basic assumptions were as
follows : in the rural areas, higher prices for agricultural goods through
the provision of export markets would act as incentives to more private
investment and production, generating more employment in agriculture.
Such agricultural expansion in turn would act as a stimulant for rural
non-agricultural activities in a virtuous circle. In the urban areas,
industrial deregulation along with export orientation would encourage
more investment and new activity in labour-intensive manufacturing in
keeping with perceived static comparative advantage, and therefore increase
employment here as well.
These assumptions were not validated
in the rural context, where (as discussed in Macroscan, Businessline,
January 2000) employment growth in agriculture appears to have become
more of a residual as non-agricultural job opportunities have slumped.
In this article we consider the evidence on urban employment, and assess
the validity of these neo-liberal assumptions which have become almost
axiomatic in Indian policy debate.
Chart 1 and Chart 2 plot the pattern
of work participation of urban men and women respectively over the 1990s.
Male work participation rates show a fair amount of fluctuation around
a fairly narrow band of between 50 and 53 per cent, and no clear trend
is discernible, which in itself suggests that not much has changed in
terms of dramatic increases in perceived employment opportunities.
Chart 1 >>
Chart 2 >>
For women, the picture is rather different.
Here too there is fluctuation, but the overall trend appears to be one
of decline. Indeed, the decline, on a point-to-point basis, is a very
significant one for just a decade, by more than 4 percentage points
from 15.6 per cent to 11.4 per cent. This is extremely interesting,
for it suggests that the picture that was being painted in the early
1990s, of a process of "feminisation" of employment, especially
export-oriented manufacturing at the margin, has not been substantial
enough to counteract other forces which have made for downward pressure
on work participation rates. |
