Azim Premji University, in collaboration with 9 Civil Society Organisations (CSOs), conducted a survey of 3,000 households in 92 low-income settlements across 39 wards of Bengaluru. The survey was done to estimate the continuing impact of COVID-19 induced lockdowns and economic disruptions on employment and livelihoods. The survey also captured information on access to government support as well as coping mechanisms to deal with such a crisis. Workers in a wide range of occupations such as drivers (cab, auto, and others), daily wage workers (construction and others), domestic workers, and factory workers (garment and others) were surveyed. The survey was conducted in the month of November 2021 with the help of Action Aid, Association for Promoting Social Action (APSA), The Center for Advocacy and Research (CFAR), Hasiru Dala, Gubbachi, Reaching Hand, Sangama, Swabhimaan Trust, and Thamate.
in Azim Premji University
The Indian story of economic growth and structural transformation has been one of significant achievements as well as continuing challenges. On the one hand, the economy has grown rapidly since the 1980s, drawing millions of workers out of agriculture. And the proportion of salaried or regular wage workers has risen while that of casual workers has fallen. On the other hand, manufacturing has failed to expand its share of GDP or employment significantly. Instead, construction and informal services have been the main job creators. Further, the connection between growth and good jobs continues to be weak.
When we speak of new opportunities, another important set of questions arises. Who is able to take advantage of them, and who is not? Has growth created faster improvements for marginalised groups, enabling them to catch up with more advantaged groups? This year’s report takes a detailed look at the impact that growth and structural change have had on some long-running social disparities. We show that significant progress has been made on all fronts since the 1980s, but also that there is a long road ahead.
The report makes use of official datasets such as the NSO’s Employment-Unemployment Surveys, the Periodic Labour Force Surveys, the National Family Health Surveys, the Annual Survey of Industries, and the Economic and Population Censuses. The researchers also make use of a unique primary survey carried out in rural Karnataka and Rajasthan, the India Working Survey. This year’s report goes further than our earlier three editions and makes extensive use of regression analysis to offer more precise estimates of the impacts of structural change on employment conditions and outcome gaps.
in Azim Premji University
In India, as in many countries around the world, most government jobs are allocated through a system of merit-based exams. Over the past few decades, these exams have become incredibly competitive, at times receiving over 1,000 applications for each vacancy.
Against a backdrop of rising educational attainment, high aspirations, disappointment with private sector opportunities, and a deep unmet need for income security, it is understandable why the demand for public sector employment opportunities is so high.
Yet despite the large footprint that public sector recruitments have in our social, economic and political life, many basic questions about them remain shrouded in mystery. Who applies? Why do they apply? Are these intense levels of competition socially productive, or do they make people worse off? Why are people willing to invest so much in exam preparation? Why are people willing to gamble on such low odds of getting selected?
Our lack of understanding limits our ability to formulate sound labour market policy. As we will see, a large share of college graduates participate in public sector recruitment exams, and candidates for these exams make up a disproportionate share of the overall unemployed population. How can we improve employment outcomes if we do not understand who the unemployed are and how they invest their time?
The main reason for the holes in our understanding is a lack of data. To date, neither private nor public household surveys include questions on whether individuals are preparing for competitive exams; and recruitment agencies have historically been cloistered institutions, understandably concerned about protecting the integrity of the recruitment process. As a result, the crores of candidates preparing for competitive ex- ams around the country remain largely invisible in data, and by extension in policy.
This report attempts to shine a light on this dark corner of the labour market. To do so, the researcher uses several new sources of data. First, he draws on administrative data from a recruitment agency. This data allows us to observe the whole recruitment process for the entire universe of applicants — the first time such data has been made available in the Indian context.
Second, the researcher uses data from a large-scale survey of over 3,000 candidates, which provides information about their investments in exam preparation, their access to resources, their constraints, and their beliefs.
Third, the research collaborators and the researcher conducted interviews and focus groups with candidates to better understand them in their own words. These rich data sources provide new insights into the economic and social life of candidates preparing for competitive exams.
The goal of this report is to demonstrate how both labour market and recruitment policy can be informed by a better understanding of candidate application behaviour. This un- derstanding can, in turn, help us tackle some of the key challenges in the modern Indian labour market — high levels of educated unemployment, a lack of skill development, low levels of female labour force participation, and more.
When the pandemic hit, the Indian economy was already in the most prolonged slowdown in recent decades. On top of this, there were legacy problems such as a slow rate of job creation and lack of political commitment to improving working conditions which trapped a large section of the workforce without access to any employment security or social protection.
The pandemic has further increased informality and led to a severe decline in earnings for the majority of workers resulting in a sudden increase in poverty. Women and younger workers have been disproportionately affected. Government relief has helped avoid the most severe forms of distress, but the reach of support measures is incomplete, leaving out some of the most vulnerable workers and households.
On the 25th of March 2020, the Prime Minister, Mr. Narendra Modi, announced a nationwide lockdown to stem the spread of the novel Coronavirus, COVID-19. The decision, while imminent, was unplanned and unilaterally made without any consultation with the state governments. This has consequently caught millions of migrant workers and the bureaucracy off-guard, leaving them no time to plan for such an emergency. While millions of migrants successfully reached their home states, only to be quarantined in camps, many remain stranded far from home, with no money or food. We are therefore confronting a lethal combination of crises: health, hunger, sanitation, and trauma, both physical and psychological.
1. State of Working India 2019 is being published close on the heels of the 2018 report. The principal reason is that this year’s report aims to intervene in the debate over employment generation in time for the general elections to be conducted in April and May 2019. In this report we present an update on the jobs situation for the period between 2016 and 2018, and also present some ideas for employment generation.
2. The recent controversy over employment statistics should be seen in the context of the fact there is now a fully established politics of unemployment in India. This is a new development that needs to be understood. The politics of unemployment is typically a feature of middle-to-high income countries, not low-to-middle income countries. Traditionally, the principal economic issue of broad spectrum political significance in India has been poverty, not unemployment.
3. There have been some new developments, which when juxtaposed with older structural and cultural factors, can account for why this is happening in India, a lower middle income country with a per capita GDP one third that of China and half that of Indonesia. The ‘precocious’ part of the Indian labour market that resembles higher income countries, that has always been there to a limited extent, is now substantial and rapidly rising, and more to the point, it has spread throughout the country, including the rural areas. This has laid the material basis for a widespread politics of unemployment.
4. Without any claim to being a complete list, we discuss seven key factors on the supply side of the labour market and two crucial demand side factors that together contribute to the crisis. On the supply side we have high growth rates and aspirations, the youth bulge, the education wave, the dominance of ‘general’ degrees, sub-standard degrees, and continued relevance of caste and gender based rigidities. On the demand side we have the collapse of public sector employment and inability of the private sector to create adequate good jobs due to contractualisation and automation.
5. The foregoing factors are clear to all observers of the Indian economy. The question is, of course, what can be done? Several long-term and short-term measures which face these structural conditions as they exist currently, are needed. Public action and spending should be strong elements of all these measures.
6. The report details four policy measures for addressing the crisis. In Chapter Three, Strengthening Towns through Sustainable Employment: A Job Guarantee Programme for Urban India, we propose a programme that calls for providing 100 days of guaranteed work at D500 a day for a variety of works in small towns. It also provides for 150 contiguous days of training-and-apprenticeship at a stipend of D13,000 per month for educated youth. In Chapter Four, Creating Good Jobs through a Universal Basic Services Programme, we argue that a well-executed UBS would go a long way in restoring public goods to their rightful place in society, creating decent work in the process. Chapter Five, How to Revive Indian Manufacturing: On the Need for Industrial Policy, by Jayan Jose Thomas discusses the renewed interest in, and continued relevance of industrial policy. Srinivas Thiruvadanthai in Chapter Six, Using Fiscal Policy to Alleviate the Job Crisis, argues that there is ample fiscal space to address the criss via public spending.
7. India is at a crucial juncture in its economic development where timely public investment and public policy can reap huge rewards. At the same time, being in denial about the current realities and missing this window of opportunity can have large negative consequences in social and economic terms. Let us act together to ensure that it is the first eventuality that comes to pass.
Microenterprises have been the engines of job growth in the majority of dynamic economies. India is home to thousands of microenterprise clusters as well as millions of distributed entrepreneurs who can become job creators. Fostering of such mass-entrepreneurship is key to addressing India’s employment challenge.
Case studies of clusters in general, and of women entrepreneurs in particular, show that if key factors such as collective action, infrastructure, credit, and market linkages are in place, returns to entrepreneurship are vastly improved. Inspirational stories are also emerging in the use of fourth industrial revolution technologies to improve access to markets and enter global value chains in a way that awards greater agency to women entrepreneurs.
Our aim in this report is to provide information and analysis that can assist policy-makers and the microentrepreneurial ecosystem at large to develop tools required to help this sector flourish. The study looks at non-farm microenterprises that employ less than 20 workers. We analyse various dimensions such as geographical distribution, demographics, gender (employment and enterprise ownership), industrial distribution, labour productivity, and wages. The analysis is based on Economic Census and National Sample Survey data.
India is one of the world’s fastest growing economies. To be a stable and prosperous democracy, this growth must be accompanied by the creation of meaningful, secure and remunerative employment. Realising this goal requires a grounded and comprehensive overview of the state of labour markets, employment generation, demographic challenges and the nature of growth.
The State of Working India (SWI) is envisioned as a regular publication that delivers well-researched, analytically useful information on India’s labour market, by bringing together researchers, journalists, civil society activists, and policymakers interested in labour and employment issues.
The report is based on the research of CSE staff, as well as on background papers which are available online. SWI conceives of India’s ongoing structural transformation as composed of two processes — movement of workers from agriculture to non-farm occupations (the Kuznets process) and from informal activities to formal ones (the Lewis process). But it adds crucial considerations of social equity and ecological sustainability to this standard framework. In the 21st century, Lewis and Kuznets have to meet Ambedkar and Gandhi.
CSE Working paper Series
CSE Working Paper Series
Did the nation-wide implementation of e‑FMS in MGNREGS result in reduced expenditures? A re-examination of the evidence
This paper revisits a part of the analysis by Banerjee et al. (2020), in which they examine the consequences of the nation-wide scale up of reforms to the funds management system (e‑FMS) in India’s national workfare programme, using a two-way fixed effects specification. They report…
CSE Working Paper Series
Who was Impacted and How? | COVID-19 Pandemic and the Long Uneven Recovery in India
We investigate the impact of the COVID-19 pandemic on income levels, poverty, and inequality in both the immediate aftermath and during the long uneven recovery till December 2021 using high-frequency household survey data from India. We find that the average all-India household income dropped between…
CSE Working Paper Series
Loss, recovery and the long road ahead: Tracking India’s informal workers through the pandemic
Drawing on results from a panel of 2778 workers interviewed during and after the 68-day hard lockdown imposed in India, the following study examines the livelihood impact of the pandemic and the extent of subsequent recovery or lack thereof. Focussing specifically on workers located in…
CSE Working Paper Series
Labour incomes in India: A comparison of PLFS and CMIE-CPHS data
The COVID-19 pandemic has created a need for high-frequency employment and income data to gauge the nature and extent of shock and recovery from month to month. Lack of such high frequency household-level data from official sources has forced researchers to rely almost entirely on…
CSE Working Paper Series
How Comparable are India’s Labour Market Surveys?
The Centre for Monitoring Indian Economy’s (CMIE) Consumer Pyramid Household surveys have emerged as an important source of regular labour market data for India. Given the differences in methods in data collection between the CMIE and official employment sources, it becomes exceedingly important to establish…
CSE Working Paper Series
Estimating the productivity gap between organised and unorganised small-scale units in India’s manufacturing sector
Small manufacturing firms are considered to be engines of growth and job creation. While most research on small firms focuses on formal sector units, in India informal sector units far outnumber the formal. This is true even for manufacturing units employing 5 to 49 workers,…
CSE Working Paper Series
Labour market flows and gender differentials in urban unemployment over the pandemic
Utilising data from the Periodic Labour Force Survey, the researchers estimate quarterly changes in urban labour market flow over the period 2018 to 2022 and the impact on unemployment rates for men and women. Their analysis provides non-intuitive explanations for established findings as well as…
Jha, Mrinalini and Amit Basole. 2023. Labour Incomes in India: A Comparison of Two National Household Surveys. The Indian Journal of Labour Economics, 2023.
Bahal, G., Iyer, S., Shastry, K., and Anand Shrivastava. 2023. Religion, Covid-19 and Mental Health. Cambridge Working Papers in Economics CWPE2302
Ticku, R, A Shrivastava and S Iyer (eds). 2023. Economic Shocks and Religious Conflict in Medieval India. CEPR Press Discussion Paper No. 17986, 2023.
Basole, Amit. 2022. Structural Transformation and Employment Generation in India: Past Performance and the Way Forward. The Indian Journal of Labour Economics, 65(2), 295 – 320.
Bahal, G., Shrivastava, A. 2022. Fiscal transfers and inflation: evidence from India. Empirical Economics 63, 1837 – 1858 (2022).
Goel, Deepti, Rosa Abraham and Rahul Lahoti. 2022. Improving Survey Quality Using Paradata: Lessons from the India Working Survey. IZA Discussion Paper No. 15041.
Abraham, Rosa and Anand Shrivastava. 2022. How Comparable are India’s Labour Market Surveys? Ind. J. Labour Econ. 65, 321 – 346 (2022).
Jha, Mrinalini, and Rahul Lahoti. 2022. Who Was Impacted And How? Covid-19 Pandemic And The Long Uneven Recovery In India, WIDER Working Paper 2022⁄105 Helsinki: UNU-WIDER, 2022.
Abraham, R., Lahoti, R. & Swaminathan, H. (2021) Childbirth and women’s labour market transitions in India (revised). WIDER Working Paper 2021⁄149. Helsinki: UNU-WIDER.
Nath, Paaritosh and Amit Basole. 2021. Did Employment Rise or Fall in India between 2011 and 2017? Economic and Political Weekly, August 21, 2021.
Buddha, C., Dhorajiwala, S., and Narayanan, R. 2021. Can a machine learn democracy? AMCIS 2021 Proceedings. 8.
Abraham, R., Basole, A., Kesar, S. 2021. Down and out: The Gendered Impact of the Covid-19 Pandemic on India’s Labour Market. Economia Politica.
Bahal, Girish and Anand Shrivastava. 2021. Supply variabilities in public workfares. Journal of Development Economics, Volume 150.
Surbhi Kesar, Rosa Abraham, Rahul Lahoti, Paaritosh Nath & Amit Basole. 2021. Pandemic, informality, and vulnerability: impact of COVID-19 on livelihoods in India. Canadian Journal of Development Studies / Revue canadienne d’études du développement.
Basole, Amit. 2021. Labour, Livelihoods, and Employment in the 2021 – 22 Union Budget. Economic and Political Weekly, February 27, 2021.
Adhikari, A., Goregaonkar, N., Narayanan, R. et al. 2020. Manufactured Maladies: Lives and Livelihoods of Migrant Workers During COVID-19 Lockdown in India. Ind. J. Labour Econ. 63, 969 – 997 (2020).
Gupta, Gaurav and Basole, Amit. 2020. India’s Information Technology industry: prospects for growth and role in structural transformation. Decision 47, 341 – 361.
Bhattacharya, Snehashish, and Surbhi Kesar. 2020. Precarity and development: production and labor processes in the informal economy in India. Review of Radical Political Economics 52(3): 387 – 408.
Kesar, Surbhi and Snehashish Bhattacharya. 2020. Dualism and Structural Transformation: The Informal Manufacturing Sector in India. The European Journal of Development Research, 32: 560 – 586.
Basole Amit and Amay Narayan. 2020. Long-Run Performance of the Organised Manufacturing Sector in India: An Analysis of Sub-periods and Industry-level Trends. Economic and Political Weekly, March 7, 2020.
Goel, Deepti, and Ashwini Deshpande. 2020. Social Identity and Perceived Income Adequacy. Review of Development Economics, 24(2): 339 – 361
Lahoti, Rahul and Soham Sahoo. 2020. Are educated leaders good for education? Evidence from India. Journal of Economic Behavior & Organization, 176, 42 – 62.
Chaudhary Latika, Jared Rubin, Sriya Iyer, and Anand Shrivastava. 2020. Culture and colonial legacy: Evidence from public goods games, Journal of Economic Behavior & Organization, 173, 107 – 129.
Sood, Atul and Paaritosh Nath. 2020. Labour Law Changes Innocuous Mistakes or Sleight of Hand?. Economic and Political Weekly, LV(22) 33 – 37.
Rajendran Narayanan and Sakina Dhorajiwala. 2019. The Namesake: Human Costs of Digital Identities. Economic and Political Weekly, December 9, 2019.
Narayanan, R., Dhorajiwala, S. & Golani, R. 2019. Analysis of Payment Delays and Delay Compensation in MGNREGA: Findings Across Ten States for Financial Year 2016 – 2017. Ind. J. Labour Econ. 62, 113 – 133 (2019).
Abraham, Rosa. 2019. Informal Employment and the Structure of Wages in India: A Review of Trends. Review of Income and Wealth, 65: S102-S122.
Goel, Deepti, and Kevin Lang. 2019. Social Ties and the Job Search of Recent Immigrants. ILR Review 72(2): 355 – 381.
Lahoti, Rahul and Rahul Mukhopadhyay. 2019. School choice in rural India: perceptions and realities in four states. Economic and Political Weekly, 54(49), 51 – 57.
Nath, Paaritosh. 2019. Employment Scenario and the Reservation Policy. Economic and Political Weekly, LIV (19), 56 – 61.
Nath, Paaritosh. 2019. Driving down the Perilous Path. Economic and Political Weekly, 54(42). ISSN (Print) – 0012 – 9976.
Nath, P., Siddiqi, U and Sood, A. 2019. Thinking Growth or Thinking Employment. India Exclusion Report 2018 – 19. (5th ed.). New Delhi: Yoda Press.
Vivek S, Rajendran Narayanan, Dipanjan Chakraborty, Rajesh Veeraraghavan & Vibhore Vardhan. 2018. Are Technology-enabled Cash Transfers Really ‘Direct’? Economic and Political Weekly, July 28, 2018.
Basole A. 2018.Understanding India’s Jobs Crisis, in Education, Employment and Employability Landscape of India. Volume 10, Issue 5 NHRD Network Journal, January 2018.
Bhattacharya, Snehashish, and Surbhi Kesar. 2018. Possibilities of transformation: The informal sector in India. Review of Radical Political Economics 50(4): 727 – 735.
Deshpande, Ashwini, Deepti Goel, and Shantanu Khanna. 2018. Bad Karma or Discrimination? Male-Female Wage Gaps among Salaried Workers in India. World Development 102: 331 – 344.
Iyer, S., & Shrivastava, A. 2018. Religious riots and electoral politics in India. Journal of Development Economics, 131, 104 – 122.
Abraham, R. 2017. Informality in the Indian Labour Market: An Analysis of Forms and Determinants. The Indian Journal of Labour Economics, Springer; The Indian Society of Labour Economics (ISLE), vol. 60(2), pages 191 – 215, June.
Basole A. 2017. The Politics and Economics of Demonetisation (Hindi). Pratiman, June 2017.
Basole A. 2017. What Does the Rural Economy Need: Analysis of the Promises for Rural India. Economic and Political Weekly Union Budget 2017 – 2018 Special Issue, March 4, 2017.
Basole A. 2016. Informality and Flexible Specialization: Apprenticeships and Knowledge Spillovers in an Indian Silk Weaving Cluster. Development and Change, Vol 47, No.1, pp.157 – 187.
Lahoti, R., & Swaminathan, H. 2016. Economic Development and Women’s Labor Force Participation in India. Feminist Economics, 22(2), 168 – 195.
Lahoti, R. 2016. Questioning the “Phenomenal Success” of Aadhaar-linked Direct Benefit Transfers for LPG. Economic and Political Weekly, Vol. 51, Issue No. 52.
Swaminathan, H., Lahoti, R., & Suchitra, J. Y. 2012. Gender asset and wealth gaps: Evidence from Karnataka. Economic and Political Weekly, 59 – 67.
Khanna, Shantanu, Deepti Goel, and René Morissette. 2016. Decomposition Analysis of Earnings Inequality in Rural India: 2004 – 2012. IZA Journal of Labor & Development 5:18.
Basole A. 2015. Authenticity, Innovation and the Geographical Indication in an Artisanal Industry: The Case of the Banarasi Sari. The Journal of World Intellectual Property, 18:3/4, pp. 127 – 149.
Basole A, Basu D, and Bhattacharya R. 2015. Determinants and Impact of Subcontracting: Evidence from India’s Informal Manufacturing Sector. International Review of Applied Economics, 29:3, pp.374- 402.
Basole A and Basu D. 2015. Non-Food Expenditures and Consumption Inequality in India. Economic and Political Weekly, Vol. 50, No. 36, pp. 43 – 53.
Basole A and Basu D. 2015. Fueling Calorie Intake Decline: Household Level Evidence from Rural India. World Development, Vol. 68, pp. 82 – 95.
Basole A. 2014. The Informal Economy from a Knowledge Perspective. Yojana Development Monthly, October 2014.
Basole A. 2014. Dynamics of Income Inequality in India: Insights from World Top Incomes Database. Economic and Political Weekly, Vol. 49, No.40, pp.14 – 17.
Nath, P. 2014. Labour Market Flexibility and Employment Growth in India’s Organised Manufacturing Sector, 1990 – 2010. The Indian Journal of Labour Economics, 57 (4), 465 – 499.
Sood, A., Nath, P. and Ghosh, S. 2014. Deregulating Capital, Regulating Labour: The Dynamics in the Manufacturing Sector in India. Economic and Political Weekly, LXIX (26 & 27), 58 – 68.