07-19-2007, 03:04 AM
<!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Help wanted </b>
The Pioneer Edit Desk
Rosy statistics don't create jobs
The Government's assessment that unemployment in India will be taken care of by 2010 would seem a trifle optimistic. It would also call into question what exactly is meant by "full employment", and whether even temporary work opportunities would qualify as proper "jobs". Mr C Rangarajan, chairman of the Prime Minister's Economic Advisory Council, a former Reserve Bank Governor and one of India's most respected economic policy-makers, told a news conference earlier this week that, based on projections of a GDP growth rate of eight per cent a year, the work-force will equal the labour force by 2010. Is this a miracle come true, or a statistical anomaly? The second may be more likely. There is little doubt that economic reform has created new, hitherto unknown jobs, particularly in services and, to a degree, in value-added manufacture. Yet, certain characteristics of the Indian economy as well as peculiarities in data gathering methods ensure that the NSSO survey data, on which the Government has based its cheerful predictions, do not necessarily reflect reality. <b>For instance, the large part of the Indian workforce is in the unorganised sector and may be in seasonal, irregular employment. These facts are the statistical equivalent of 'invisibles' - they do not necessarily find adequate reflection in Government records. To qualify for the latter, a person may be considered employed even if he has work for only one hour a week.</b>
Mr Rangarajan's report, presented to a Prime Minister who obviously knows better, does not reveal the complexity of the employment situation or that there may actually be a job crisis building up in the country. It is a politician's document, rather than an economist's. In actuality, there is a huge oversupply of labour that subsists mostly on 'below poverty line' income.<b> A young population - one-third of India, a full 440 million people, is below 18 - only means a continuous addition to this labour force, even as the problems of concealed unemployment, partial employment and underemployment - all salient phenomena in the agricultural sector - persist.</b> As long as the bulk of India's investment in agriculture is pre-harvest rather than post-harvest, this trend will continue. The entry of organised retail and its ability to enter into long-term supply contracts with farmers will make a dent, but only a dent. Neither is India's economic reform story going to generate mass-scale industrial jobs like China. That country's wonderfully liberal - or wonderfully exploitative - labour laws and early-mover advantage have made it the world's workshop for low to mid-technology goods. India's growth story so far has been services-driven. With focussed investments from economic partners like Japan, there is now a concerted effort at new manufacturing. This will use a technology a generation ahead of the Asian Tigers and make India globally competitive in some aspects of manufacture - such as has happened in automobile components. Yet, these temples of post-modern India will not employ hundreds or thousands of workers.<b> Rather, they will be technology-driven, run by innovative IT programmes written by Indian software writers, but, eventually, surrendering the production cycle to intelligent machines rather than a sweating proletariat. Should this scenario play itself out, it will make India, paradoxically, both a rich country and a job scarce one. The Government's in-house wonks are expected to square that circle, not pretend it doesn't exist.</b> <!--emo&
--><img src='style_emoticons/<#EMO_DIR#>/biggrin.gif' border='0' style='vertical-align:middle' alt='biggrin.gif' /><!--endemo--> <!--QuoteEnd--><!--QuoteEEnd-->
The Pioneer Edit Desk
Rosy statistics don't create jobs
The Government's assessment that unemployment in India will be taken care of by 2010 would seem a trifle optimistic. It would also call into question what exactly is meant by "full employment", and whether even temporary work opportunities would qualify as proper "jobs". Mr C Rangarajan, chairman of the Prime Minister's Economic Advisory Council, a former Reserve Bank Governor and one of India's most respected economic policy-makers, told a news conference earlier this week that, based on projections of a GDP growth rate of eight per cent a year, the work-force will equal the labour force by 2010. Is this a miracle come true, or a statistical anomaly? The second may be more likely. There is little doubt that economic reform has created new, hitherto unknown jobs, particularly in services and, to a degree, in value-added manufacture. Yet, certain characteristics of the Indian economy as well as peculiarities in data gathering methods ensure that the NSSO survey data, on which the Government has based its cheerful predictions, do not necessarily reflect reality. <b>For instance, the large part of the Indian workforce is in the unorganised sector and may be in seasonal, irregular employment. These facts are the statistical equivalent of 'invisibles' - they do not necessarily find adequate reflection in Government records. To qualify for the latter, a person may be considered employed even if he has work for only one hour a week.</b>
Mr Rangarajan's report, presented to a Prime Minister who obviously knows better, does not reveal the complexity of the employment situation or that there may actually be a job crisis building up in the country. It is a politician's document, rather than an economist's. In actuality, there is a huge oversupply of labour that subsists mostly on 'below poverty line' income.<b> A young population - one-third of India, a full 440 million people, is below 18 - only means a continuous addition to this labour force, even as the problems of concealed unemployment, partial employment and underemployment - all salient phenomena in the agricultural sector - persist.</b> As long as the bulk of India's investment in agriculture is pre-harvest rather than post-harvest, this trend will continue. The entry of organised retail and its ability to enter into long-term supply contracts with farmers will make a dent, but only a dent. Neither is India's economic reform story going to generate mass-scale industrial jobs like China. That country's wonderfully liberal - or wonderfully exploitative - labour laws and early-mover advantage have made it the world's workshop for low to mid-technology goods. India's growth story so far has been services-driven. With focussed investments from economic partners like Japan, there is now a concerted effort at new manufacturing. This will use a technology a generation ahead of the Asian Tigers and make India globally competitive in some aspects of manufacture - such as has happened in automobile components. Yet, these temples of post-modern India will not employ hundreds or thousands of workers.<b> Rather, they will be technology-driven, run by innovative IT programmes written by Indian software writers, but, eventually, surrendering the production cycle to intelligent machines rather than a sweating proletariat. Should this scenario play itself out, it will make India, paradoxically, both a rich country and a job scarce one. The Government's in-house wonks are expected to square that circle, not pretend it doesn't exist.</b> <!--emo&
--><img src='style_emoticons/<#EMO_DIR#>/biggrin.gif' border='0' style='vertical-align:middle' alt='biggrin.gif' /><!--endemo--> <!--QuoteEnd--><!--QuoteEEnd-->