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19 Lakh Jobless in Gujarat, not Six Lakh: Gujarati Economist

Fri, 01 Dec 2017 02:02:40 +0000

Image Courtesy: Metro Vartha

Gujarati Economist contests chief minister Vijay Rupani’s claim for organised sector: Jobless Growth, Mockery of the Unemployed: Gujarat Model

Presenting independent calculation of the state’s employment figures, Lokshahi Bachao Andolan (Save Democracy Movement), a campaign platform set up ahead of the Gujarat elections, claiming to be not associated with any political party, has de-bunked official claims on employment and jobs. In a detailed presentation yesterday, they have said that much of the “tall talk” of employment generation during the biennial Vibrant Gujarat global investment summits, during 2004-15, 43.44 lakh fresh unemployed were registered with Gujarat’s Employment Exchanges. Of these only 24.41 lakh people could get employment.

Contesting the figure provided by Gujarat chief minister Vijay Rupani, that there are only six lakh unemployed in the state as of today, economist Prof Hemant Shah, associated with the Lokshahi Bachao Andolan, or Save Democracy Movement, told media in Ahmedabad, “Even if we concede that Employment Exchange figures are true, as many as 19.09 lakh people could not get employment during 2004-15.”

Not only are lakhs of people jobless in Gujarat but there is zero social security for workers.

More unemployed persons get registered and less get employment.
Workers from the unorganized sector have been hard-hit.
Employment claims including those of ‘Vibrant Gujarat’ have been proved to be hollow.
Very few people get employment under ‘NREGA’.
Despite the avowed policy of giving employment to 85 % locals, Gujarat government surrenders to the industries at the cost of local employment.
Lakhs of workers are deprived of benefits of social security.

Shah further said, “Each year fresh unemployed are registered, and the names of those who get jobs are deleted. The total number of new job seekers registered with Employment Exchanges in 2001-02 was 2.52 lakh. Things deteriorated year after year. In 2015-16, the number of those who registered for jobs increased to 6.11 lakh. Of this, job recommendations were made for 5.12 lakh, but only 1.77 lakh, i.e. only 35% people, got jobs.”

Pointing out that overwhelming majority of those who register themselves in Employment Exchanges are skilled workers, Shah said, this state of affairs is only of the organised industrial sector, adding, “As for the unorganized sector, we don’t have any figures of the people who may be unemployed or underemployed. Nearly 90% of the workforce in Gujarat and India is employed in the unorganized sector, which includes agriculture.”

Shah said, poor provision of employment in Gujarat has against the backdrop of huge claims made during the biennial Vibrant Gujarat Global Investors’ summits, begun by Narendra Modi as state chief minister in 2003. Thus, he said, figures show, during the 2009 summit an employment potential of 29.81 lakh was announced, followed by 60.69 lakh in 2011.

Lakhs of People are Jobless

In the year 2001-02, 2.52 lakh fresh jobless workers entered the market and were registered but eight years later, in the year 2010-11, 4.11 lakh fresh jobless were registered. In the year 2015, 4.74 lakh jobless have been registered and only 3.37 lakh people got employment. Thus, year after year, more and more jobless people have been registered in the state.

During 2001-11, 29.86 lakh fresh jobless were registered and only 13.38 lakh people got jobs in the state of Gujarat. Thus, during that period, 16.48 lakh people had remained unemployed. Taking into account the span of 2004-15, 43.44 lakh fresh unemployed people registered their names in the state employment exchanges but only 24.41 lakh people got employment and 19.09 lakh people could not get employment. In this way, there has been consistent rise in the number unemployed registered persons in the state.

In the year, 2015, the number of registered jobless people was 6.11 lakh including both educated and uneducated unemployed persons.

Records show that even all the recommended persons from the Employment Exchanges do not get employment. During the period of first six months of the year 2015-16, while there were recommendations to 5.12 lakh people, in actuality only 1.77 lakh people, i.e. only 35 % people got employment.

The unemployment level of skilled and highly educated persons in Gujarat has created real distress. Almost 80 % of engineers in the State are jobless. Because of such large unemployment, there are some 200 to 500 applicants for only one vacancy as and when there is a job tender published and announced by the state government. Even for the vacancy of the post of Talati, lakhs of people applies for the job. Similar is a predicament of Pharmacists, Dentists etc.

The declared policy of offering employment to locals – upto 85 % of vacancies in the industries including Tata’s Nano Project, has not been implemented. While the government is offering relief in lands, water and power supply to the tune of crores of rupees to corporates, on the question of job for the locals, the state government is content with merely issuing notices to defaulter industries.

One of the reasons for tremendous rise in unemployment in Gujarat is attributed to thoughtless, sudden, haphazard and abrupt demonetization (2016) and GST. Over 90 % of the workers in the State are employed in the unorganised sector. Major portion of rural and urban population of the State is engaged in sectors such as construction, transport, home –based industries, small and tiny sectors etc. These people were producing 61 % products for the State’s GDP in the year 1997-98. Presently, its share has come down to 50 %. Due to the blows caused by demonetization and GST, a 2 % reduction has been observed in the GDP growth rate. As per one calculation, reduction of 1 % in the GDP reflects into 0.75 % reduction in the employment level. If one takes into account all this, then it will reveal that reduction of 2 % in the GDP has resulted into 1.5 % decline in the above-mentioned unorganised sectors, which accommodate over 90 % of the work force in the state of Gujarat.

While tall claims of employment generation were made in the Vibrant Gujarat Investment Summits organized at a huge public expenditure of crores of rupees, these have not been realised. In the Vibrant Gujarat Summits of the years 2003, 2005, 2013, 2015 and 2017 no announcements were made on the employment potential of the prospective capital investment. Whereas, in the summits of the year 2007 the employment potential of 13,12,436 persons and in the summit of the year 2009 employment potential of 29,81,021 persons was announced. In the 2011 Vibrant Gujarat Summit, employment potential of 60 lakh jobs was anticipated. With the implementation of Vibrant Gujarat Summit of 2007, employment opportunity for 55,463 jobs and in the summit for the year 2009, employment opportunity for 3,84,954 jobs was created.

Addressing the media, former BJP chief minister Suresh Mehta blamed the Gujarat government for hiding jobs data in the organised sector after 2010, saying, “The figures show that, as of March 2008, 18.39 lakh people were employed in state and private sector enterprises, which increased to 19.49 lakh in March 2009.”

“Thereafter”, he said, “The state government only released jobs potential data announced at different Vibrant Gujarat summits. Since 2007, about one crore jobs potential data were announced. If we all jobs potential announced for Special Economic Zones, it comes to 1.16 lakh. On the other hand, we find from whatever figures we have been able to obtain, that jobs increase by 1.5 or 2 lakh per year.”
Continued Mehta, “The policy of offering employment to the local people up to 85% of vacancies in industries, including the Tatas Nano Project, has not been implemented. The government is offering relief in lands, water and power supply to the tune of crores of rupees, yet, thr government remains contented merely by issuing notices to such defaulter industries.”

Veteran economist Rohit Shukla said, “One of the reasons for tremendous rise in unemployment in Gujarat is attributed to thoughtless, sudden, haphazard and abrupt demonetization and Goods and Services Tax (GST). A major portion of rural and urban population of the state is engaged in sectors such as construction, transport, home based industries, small and tiny sectors etc.”

“These people were producing 61% products for the state GDP in the year 1997-98. Presently, its share has come down to 50%. Due to blows of demonetization and GST, 2% reduction is observed in the GDP growth rate. As per one calculation, reduction of 1% in the GDP reflects into 0.75 % reduction in the employment level”, he added.

Very Few People get Employment under MANREGA

► MNREGA was promulgated by Parliament in the year 2005, but the state government, then led by Narendra Modi implemented it only in the year 2006.

► In the Budget of 2017-18, under the NREGA scheme, the government has made a provision for Rs. 380 crores and had stated that 6.1 lakh families will get employment. This means an admission that in each such family there are jobless persons. If 2 unemployed persons are assumed per family, there are 12.20 lakh persons are jobless in the rural areas of the state. All these are uneducated families who do not get their names registered with the Employment Exchanges.

► During the period of 2007-12 the Central Govt. had allocated Rs. 2,236 crores to the State Govt. for implementation of NREGA but the Gujarat Govt. had provided employment only to 3 to 6 % workers demanding employment to the Job Card holder families for 100 days. Thus, the fund allocated by the central government has remained unutilized.

► In the budget speech, the Finance Minister of Gujarat had announced that 6.1 lakh families shall be provided employment in the year 2017-18, and 340 lakh mandays employment will be generated. If employment for 100 days is to be provided to one family under the NREGA, then employment potential works out to 610 lakh of mandays. Thus the government had decided in advance to give employment for only 44 days as against for 100 days.

► In Gujarat 38.45 lakh rural families had obtained job cards under the NREGA. Even then, the State Govt. states that in the year 2017-18 it will give employment to only 6.10 lakh families. How, the campaigners have questioned, how will the remaining 32.35 lakh families get employment? Moreover, the office of the Gujarat Rural Development Commissioner says that 7.50 lakh families had demanded job under NREGA, but jobs were offered to only 6.80 lakh families. Thus, 70,000 families did not get unemployment though they demanded job security under NREGA. In Gujarat, daily average wage of Rs. 130.81 is given under the MANREGA. Whereas against that, rate of daily wage is Rs. 153 in Bihar, Rs. 142 in UP, Rs. 159 in Maharashtra and Rs. 180 in Kerala.

► Under the NREGA, during 2016-17, 3,46,608 people of Gujarat had demanded work but only 1,35,112 persons i.e. 39 % people were provided employment. During the entire year, 25.23 man days employment was provided. Thus, merely 7.22 % target had been achieved. Under the 2005 law, the government is bound to provide employment for 100 days to every family but employment was provided only for 18.76 days. If this is the situation for the last year, then how can the state government falsely claim that 340 lakh mandays employment will be provided during the current year?

► The situation for the year 2015-16 is worse. Statistics show that the number of people seeking employment was 5,70,509 but only 4,17,670 people could get jobs. Thus, 27 % could not get employment even though they had demanded jobs. On an average, only 35 days employment was given by the state and merely 10,418 families got 100 days employment.

Gujarat is trailing behind in Social Security of Workers:
→ In Gujarat, the Govt. does not pay enough attention for social security of the workers. Against every 1000 workers, only 419 of urban men and 604 of urban women have received any benefit of the Social Security Schemes. Here, respectively, Gujarat ranks at no. 32 and no. 22 in the country. In the same way in the rural areas, for every 1,000 men, 521 Nos. and 450 women have received benefit of social security schemes. In both the matters, Gujarat ranks at no. 22 in India as a whole.

→ Condition of workers engaged on contractual basis in Gujarat is worse than that in other states. Out of 1,000 contractual workers, only 78 workers get leave with wages and in that, the rank of Gujarat is at No. 7. Whereas, benefit of social security schemes reach to only 166 workers and in it Gujarat ranks at 16.

→ Among those, who get regular salary, the condition of such workers in respect of social security is poor in Gujarat. Out of every 1,000 workers only 422 workers get leave with wages. Here, among 36 states and Union Territories Gujarat is ahead of only Telangana and Chandigarh. The workers of Gujarat are far behind in availing benefits of Social Security schemes. Against 1,000 workers, only 362 workers get benefits of social security schemes and Gujarat ranks at 3 from the last rank only with Diu-Daman and Andhra Pradesh.

→ In Gujarat, there are 12 lakh workers from Gujarat and 8 lakhs from other States, aggregating to 20 lakh workers are engaged in the construction business. For their social security, the Parliament had passed two Acts in the year 1996. Under those laws, cess at the rate of 2 % is levied on the construction of buildings and other constructions. As a result, an amount of more than Rs. 1600 crore has been accumulated in the coffers of the state. The Board constituted under the Act for the welfare of the construction workers, got only Rs. 700 crore by the state Govt. The Govt. spends remaining amount in its budget funds. In fact, this sum has no relation at all with the general budget. Even then, the state government takes up this amount to the credit in the Consolidated Fund and spends off the same. Until the year 2014 the Govt. had not spent almost any sum from the income of such cess.

→ The situation of contractual workers in Gujarat is grim and out of 1000 urban workers, 948 workers are employed without any kind of written agreement. Gujarat ranks at no. 14 in such unfair practices. In rural Gujarat, only 6 out of 1,000 workers get jobs with any written contractual agreement and among 36 states and Union Territories, Gujarat ranks at no. 5 from the bottom, that is it is 31st in assessment of protection for the unorganised sector.

→ The central government runs many schemes for employment generation, including NREGA. However, the benefits have reached only 40 people out of 1,000 persons. In that respect, Gujarat is ranking at the very bottom except for Diu-Daman.

Note: Details and statistics furnished in this Press Note are based on the following documents:
Budget speech of Finance Minister of Gujarat, 2017.

Socio-Economic Review, 2016-17, Gujarat State.
Website of Gujarat Government’s Rural Development Commissioner.
Outline of Activities: 2016-17, Budget Publication No. 32, Gujarat State.
Various Reports of the CAG.
5^th Annual Employment-Unemployment Survey, 2015-16, Labour Bureau, Govt. of India.
Working Paper No. 2, National Commission for Enterprises in the Unorganized Sector, Delhi, June 2008.
Discussions in the Legislative Assembly of Gujarat State.

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CMIE Says India’s Unemployment Rate 8.2%, Highest in 11 months, Greater Unemployment 15%

Thu, 12 Oct 2017 05:57:36 +0000

One of India’s premier independent consultants, Centre for Monitoring Indian Economy (CMIE), has estimated that India’s urban unemployment rate in the week ended October 8 is 8.2 per cent, the highest in the past 11 months. This has happened, says CMIE, despite the fact that the “urban labour participation rate has recovered to its level during the last December-January period.”

This is how CMIE explains it, “The rise in labour participation rate and the unemployment rate shows that labour is returning back to the labour markets but it isn’t finding jobs”, adding, “The fall in labour participation rate began soon after demonetisation. We are probably seeing a recovery after about a year.”

These estimates are based on surveys carried out jointly with the Bombay Stock Exchange (BSE), the CMIE believes, it’s data, which reflected in its about-185-page statistical volume, “can help us understand employment and unemployment in India through the demonetisation period, and going ahead, through the Goods and Services Tax (GST).”

The volume, which is produced at the interval of each quarter, “provide estimates of the labour force, labour participation rate, employed and unemployed persons and the unemployment rate”, it adds. Pointing out that the methodology used by the volume shows a “useful set of additional indicators” about “greater labour force and the greater unemployment rate”, CMIE regrets, a person is considered unemployed only if s/he is “willing to work and is actively looking for a job but, is unable to get a job.”

Who has done this survey ? Carried out by Mahesh Vyas, Managing Director and CEO, the CMIE analysis of the data says, while calculating unemployment, “three conditions must be fulfilled — the person must be unemployed, must be willing to work and, must be actively looking for a job.” It adds, “The last criterion implies applying for jobs, appearing for interviews, making enquiries for jobs, standing in queues for jobs, etc.”

Unfortunately, CMIE underlines, “If an unemployed person is willing to work but is not actively looking for a job then s/he is not counted as an unemployed person for calculating the unemployment rate.” Calling it an “international practice and this is what we follow”, the CMIE says, if one considers as the unemployed those who are “willing to work but are not actively looking for a job”, the actual unemployment today would around 15 per cent.

“During 2016, the unemployment rate was 8.2 per cent”, equal to what it is today, “but, the greater unemployment rate was 15 per cent”, says CMIE, adding, actually, “the labour force is simply the sum of the unemployed as defined above and the employed. And, the unemployment rate is the ratio of the unemployed to the labour force.”

Answering the question why “should an unemployed person who is willing to work not be looking for a job?”, CMIE says, “Possibly, because such a person does not believe that a job is available. Maybe, there is a seasonality in seeking jobs. Or, there could be social constraints that refrain a person from seeking a job.” CMIE insists, “While the reasons for such behavior could be interesting, it is perhaps, very important to know the size of such persons who are willing to work but do not actively look for jobs.”

” The sum of unemployed who are willing to work and are actively looking for a job and, unemployed who are willing but not actively looking for a job is the greater unemployed”, CMIE says, adding, “Interestingly, the unemployed who are willing to work but are not actively looking for a job was about 70 per cent of the size of the unemployed who are willing and looking for a job.”

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India is Headed towards Balkanisation, Says former President Pranab Mukherjee

Sat, 07 Oct 2017 07:10:17 +0000

Mukherjee is of the view that the prevalent politics of division is deliberate, to divert people’s attention from serious issues such as misguided economic philosophy, slowdown in economic growth, and failure to create jobs

The former President Pranab Mukherjee said that the country seemed to be moving towards “Balkanisation” — the process of fragmentation, division of a region or state into smaller units that are often hostile and uncooperative with one another.“It seems as if the country is moving towards Balkanisation. What good is the politics if the country itself gets divided,” Mukherjee told Bengali Tabloid, Ebela.

The 13th President felt that it was impossible for him to sit back and watch the nation being gripped by a climate of polarisation.

He was of the view that the politics of division was a ploy to divert people’s attention from serious issues such as misguided economic philosophy, slowdown in economic growth, and failure to create jobs.When asked what he could do under the current circumstances, Mukherjee said: “This is exactly what is on my mind these days.”

Even after demitting the highest constitutional office, it seems, the veteran parliamentarian will continue to voice his opinion and concerns.On October 14, Mukherjee is scheduled to address students at Aligarh Muslim University to mark the bi-centinary birth celebrations of the institution’s founder – Sir Syed Ahmed Khan.

In November, he is set to deliver another lecture in Kolkata at Indira Gandhi Memorial orgsanised by Bidhan Trust, followed by a speech at Jadavpur University in December.

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India Has Jobless Growth, Admits Union Labour Minister Bandaru Dattareya

Wed, 31 May 2017 05:46:13 +0000

Conceding that growth of the economy was not translating into more employment, Union Minister Bandaru Dattatreya today said a task force has been set up to compile figures of jobs generated in the last three years. "The current growth is a jobless growth. Many European and Asian countries, including India, are facing it… growth is being reported but it is not reflecting in employment generation," he told reporters here.

The Gujarat developmental model, much hailed by sections of crony capitalists and aggressively pushed by Narendra Modi when he was chief minister of that state has also been critically examined by economists as a questionable model for a developing economy given its character of 'jobless growth.' Clearly under the same regime now at the Centre, this pattern, insensitive to the human resource needs of the country, is being pushed at the national level.

A jobless growth describes a situation in which an economy recovers from a recession but the job market does not.

"But we should also know that our country has only two per cent technical workforce, against the requirement which is huge," Dattatreya said. However, the Union Minister for Labour and Employment said the Narendra Modi-led governments initiatives such as Skill India aim to address this shortfall.

He said it was true that the statistics department showed that employment generation figures appeared to be very low. "But I have not received confirmed data from 23 ministries about job creation in their respective fields. I have therefore set up a task force to compile the figures and come up with (figures of) actual employment generation," he said.

The minister also said the current education system has too much emphasis on theory.

For instance, he said, in the engineering field 80 per cent curriculum is theory and 20 per cent is practical knowledge, while it should have been 75 per cent practical and 25 per cent theory. "We need to have more practical approach towards educating the youth," he added.

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