How and Why Modi’s Job Schemes have led to high Unemployment


In the run-up to the 2014 general elections, Narendra Modi and the Bharatiya Janata Party campaigned aggressively on the plank of job and employment generation. Having promised to create over two crore new jobs every year, the prime minister has since reiterated this commitment with the launch of a slew of schemes and programmes over the past four years. In August 2018, Modi claimed that, in the previous financial year, “more than 70 lakh jobs were created in the formal sector alone.”

Make in India

Despite the sound and fury of the Narendra Modi-led BJP government’s employment generation schemes, data on manufacturing shows that the sector has not seen any growth in the past four years.

Danish Siddiqui/Reuters

But a January 2019 report by the Centre for Monitoring Indian Economy, or CMIE, a business information company, reveals that as many as 1.9 crore people lost their jobs in 2018, while the unemployment rate shot up to 7.4 percent in December 2018, the highest in 15 months. According to the annual household surveys, conducted by the labour bureau, India’s rate of unemployment has seen a persistent upward trend since 2013-2014. This trend accelerated steeply in 2018, as per the report. Most of the Modi government’s policies on employment have focussed on self-employment, skill development, incentivising employers to facilitate employment generation and promotion of export-oriented manufacturing. These policies have been executed via several schemes: Make in India; the Pradhan Mantri Kaushal Vikas Yojna, or PMKVY, also known as Skill India; the Pradhan Mantri Employment Generation Programme, or PMEGP; the Pradhan Mantri Mudra Scheme, or PMMS; and the Pradhan Mantri Rozgar Protsahan Yojana, or PMRPY.

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