The center for monitoring the Indian economy’s monthly time series data revealed that the overall unemployment rate in India was 8.0% in February 2022, which fell to 7.6% in March. This condition shows us that the unemployment rate in India is at its peak right now. And the government should take some immediate action. But of course, the rate is not going to decrease overnight. According to the reports of WENR, 53 million Indians are unemployed. To remove this unemployment we will need 10 million new jobs. This means we will need 27000 new jobs every day. Then only unemployment will be finished in 12 years. The problem is not just in government, the people are also equally at fault.
An insight into the reality
For 90,000 vacancies, Indian Railways received 25 million applications in 2018. That is 300 applications for every vacancy. As of 2015, the state of Uttar Pradesh advertised 368 positions and received over 2.3 million applications. Even well-qualified applicants apply for low-skilled jobs due to widespread unemployment. A large number of these jobs were low-skilled, with salaries ranging from 10 to 12 thousand rupees per month.
For a better understanding of unemployment in India, let's take a look at the life circle of a typical youth. Let’s give him a name, umm… RAJ! If Raj goes to a government school in his village, it's unlikely he will learn anything of value there cause of its education quality. Even if Raj finishes high school, he will likely join millions of students in preparing for the IIT entrance exams, where more than 1 million students apply for only 11,000 spots. And if he doesn't get into IIT, Raj will probably end up in one of the engineering colleges where all you get is a fictitious degree. After graduating, Raj will apply for government jobs that provide a stable salary and pension. But we've seen how tough it is to get a government job, so Raj may start applying to private jobs. But if Raj didn't learn anything in college, private employers won't pay him more than Rs. 10,000 (~$150). And even if they do, it will be an informal job with no contract or pension. Because of the risk of being unemployed, Raj will have to interview for these jobs. So to find solutions, we have to understand the root causes behind this unemployment scandal.
Why is India's unemployment so high?
- Demographic growth: The rising population is one of the main reasons behind unemployment. As a result of an imbalance between the supply and demand of labor, unemployment and underemployment arose. Is there enough work in India for its 1,406,050,880 people?
- Lack of skills: Based on an Employability Assessment Survey by Aspiring Minds, approximately 95% of India's graduates are unqualified to work in software engineering. Tech Mahindra's MD also stated that 94% of engineering graduates in India are not suitable for employment. Which is another reason behind this huge rate of unemployment. People are hired only when they can provide value. So degrees are useless without skills.
- The latest technology: Advanced technology can also be blamed for this jobless economy. Jobs are being destroyed faster than they are being created by rapid technological change.
- Wage stagnation: Low wages are another cause of unemployment in India. Increasing minimum wages leads to youth unemployment by increasing job seekers and decreasing job opportunities. Not only does it cause joblessness but also workers who are afflicted by this condition tend to experience increased stress, and low self-esteem, and engage in unhealthy work habits like smoking.
- Corruption: Those citizens seeking jobs are more likely to pay bribes to officials when they are hired, resulting in higher unemployment rates among educated workers and youth. This bribe culture not only deprives talent of its worthy job but also creates no room for the poor.
Unemployment and its effects:
- Poverty pops up: It’s not uncommon to find poverty and unemployment together. It is, therefore, possible to say that the unemployment rate in India also affects the poverty rate.
- Youth depression is on the rise: Having a hard time getting a job even after graduation, or working at a low wage can trigger depression among young people. In their minds, failure is all they are. They might also develop unhealthy habits, such as smoking and drinking. Most importantly as they can’t find a decent job, they might get indulged in illegal ways to earn, which will cause an arise in criminal offenses in India.
- Lower-income growth: In India, unemployment also contributes to lower-income growth as well.
Here are several solutions to unemployment:
- Control over population: Population control can help in the reduction of unemployment.
- Improved education quality: As we talked earlier 94% of engineering graduates in India are not suitable for employment. So in order to fix this, we must improve the education quality given in schools as well as in colleges. Colleges are not just for degrees, skills should be taught here too.
- Choose the right institute: There is one vital thing people need to keep in mind while choosing the right institute. In India, rather than picking their passion as a career, students are often pressured to be an engineer, doctors, or a teacher cause of their typical Indian families. There is an urgent need for these families to understand that every job deserves respect. One can only succeed when they are interested in or love their field. For example, actors like Sushant Singh Rajput, Kartik Aaryan, Kriti Sanon, and Sonu Sood, or comedians like Abhishek Upmanyu, Ashish Chanchlani, and Kiran Dutta (AKA “the bong guy”) were engineering students but became successful as they followed their passion. This means working in an interested field leads to a bright future.
- Development in rural areas: Development in rural areas also means more job opportunities will take place. So that people living in rural areas won’t have to rely on urban jobs.
My perspective:
Despite the unemployment rate being so high, companies still spend millions on human resources to hire workers. They promise to hire people even with entry-level skills, but they aren't getting those either. Unemployment is also a consequence of our educational system and government job obsession.
Once I went to get a passport, the work was given to TCS, and they completed the process in about 30 minutes. Finally, the passport had to be signed by a government official. Whether or not they have done the process correctly. It took 1 to 1.5 hours to verify the work that has been done in 30 minutes. He pressed the button once after taking breaks 10 times.
Millions of people believe that once they have a government job, their life will be fine. They do not have to work anymore and the job is also secure. This has resulted in ruining dozens of years for the children in Mukherjee Nagar. Actually, it should take hardly 1 year to conduct the exams for SSC groups B and C, but it takes 3 to 4 years to complete the process. Because sometimes the exam date is changed, sometimes the documents are leaked. Then the result is not announced in time. And if the result is announced on time, then the accession is not on time. In the recent NTPC exam, it also took 2 years for the exam to be conducted after the date was announced. Even after the result is announced, it still takes years to get a commitment.
No one gives you the money for how high your degree is. You get the money if you are useful to the company with your skills. India produces more engineers than the population of Switzerland. And we are talking about Sundar Pichai and Satya Nadella, who got their university education abroad. According to the 2019 Annual Employability Survey reports, 80% of engineers are not employable. Universities are well aware that people come to their universities to get a professional degree and get a good job. But then when the student graduates, the programming language is a very big deal, he does not even know how to build a resume, which is the most basic thing for a job.
You have seen that in India there are many consulting companies whose work is to commit fraud with school graduates. Many scammers have started to exploit this desperate search for jobs. In order to deceive the unemployed, they first place newspaper ads. And when people apply for these fake jobs, the scammers demand large upfront payments from them in exchange for a permanent job. In Noida, police raided a similar call center where people were being scammed with the promise of finding a job. It is very easy to mislead an unemployed person, not because he is stupid, but because he has struggled a lot. So he is tired of struggling. So if he gets a little hope from somewhere, he definitely tries.
Unemployment can also have a negative impact on those who already work. Let's say you're employed. Since you are unsatisfied with your salary, you ask your boss to raise it. In response, he simply denies it, saying there are many people who will do the job for the same salary. Thus, no matter how low your salary is, no matter how toxic the workplace is, you must continue to work there in fear of losing your job.
You may not admit it, but this jobless economy is having a much greater impact than we realize.