Can industrial and service sector solve the problem of unemployment in India?By, Deepika & Divisha Eco Hons, 2nd year Hansraj College Contents INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . It is a open secret that all of the countries of the world are struggling with the problem of unemployment. One of the fastest growing economies in the world growing at over 8 % p.INTRODUCTION India¶s GDP of USD 691 bn makes it the 10th largest economy in the world and 4th largest in terms of purchasing power parity. .a for the last 3 years. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . .UNEMPLOYMENT Unemployment can be defined as a state of worklessness for a man fit and willing to work at the prevailing wage rate. Major cause of Unemployment in India: The industrial & service sector is growing undoubtedly. . but their growths aren¶t in par with the growth in Indian population. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA . Labour force scenario in India: Growth in Employment: Year 1999-2000 2004-2005 Employment (%) 0.98 2.89 Source: NSSO Survey . workforce.4 12.8 58.1 11.8 mn share of the incremental of the incremental workforce. the sector has also absorbed almost half of the increment in the workforce But. the sector has absorbed 5.5 mn share absorbed 16. the sector has But.4 But. .7 22.Sectoral Contribution in Employment: Sector/ Agriculture Manufacturing Services Year 19992000 20042005 59.7 23. self-employed.As per the data for the year 2004-05: only about 9 percent of the total workforce is in the organized sector (all public sector establishments and all non-agricultural establishments in private sector with 10 or more workers) the remaining 91 percent are in the unorganized sector. or employed as casual wage labourers . There is greater unemployment in agricultural sector than in industrial and other major sectors.Features of unemployment The incidence of unemployment is much higher in urban areas than in rural areas Unemployment rates for women are higher than those for men: The incidence of unemployment among the educated is much higher than the overall unemployment. Source: Labour Bureau of the Government of India . INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . 1 per cent to 11. In terms of employment in this sector.3% but fell to 4. .2% in the period 2002/7. the share has seen a marginal decline from 12. Industry sectors¶ contribution to real GDP in period 1992/7 was 7.7 per cent during 1999-2000 to 2004-05.3% from period 1997/02 but again picked up after 2002/3 and contributed almost 9.Growth of Manufacturing sector in India India has emerged as one of the world's top ten countries in industrial production. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . 4% in 1999-2000 to 2004-05. In the five years between 1992-93 and 1996-97 the services contributed just about half of the total growth in GDP. In the subsequent five years to 2001-02.7 % to 23. the sector¶s contribution rose sharply to 68% and has remained at a high 64% in the six years since 200102. . it increased its share in the employment from 22. In terms of employment in this sector.Growth of Service sector in India India ranks fifteenth in the services output. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . .Role of government Make labour laws more conducive to the present scenario enhance efficiency in land acquisition matters and in allotment of land to the corporate sector for their investment projects. Work upon improving the efficient functioning between various ministries. Government should try to minimize the role of corruption which directly affects our cost of services and products. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT ECONOMIST¶S VIEW CONCLUSION . the decline in employment has happened due to an increase in labour productivity over a period of time. China¶s service sector has absorbed relatively much larger labour force than India. As a corollary. the share of services in GDP has risen but with no significant increase in the share in employment. In India. . In India.COMPARING INDIA AND CHINA Growth in GDP in India is led by the IT industry while in china it is led by the manufacturing industry. As a result. the employment share of service sector in China has increased steadily since 1978. INTRODUCTION UNEMPLOYMENT EMPLOYMENT & UNEMPLOYMENT SCENARIO IN INDIA GROWTH OF MANUFACTURING SECTOR IN INDIA GROWTH OF SERVICES SECTOR IN INDIA ROLE OF GOVERNMENT IN ENHANCING EMPLOYMENT GROWTH COMPARING INDIA AND CHINA¶S GROWTH IN GDP & EMPLOYMENT CONCLUSION . Labour union must work with managements in the way the efficiency of the organizations get improved & the organization does not become uncompetitive. other regions should try to emulate so that greater empt opportunities are created in those areas also. as southern states and western states are performing well on the front of creating opportunities for better industrial climate. Industries should be established on the barren and waste land instead of fertile land.Measures to enhance employment in industrial sector: Enhance the production capacity of firms. . Measures to enhance employment in service sector Compulsory education to all so that the future is educated. Also focusing on skill productivity per worker. should be the priority of the government that alone can serve the problem of generating employment in this sector to a large extent. development will enhance . this sector consists of almost over half of our working population. As neglect of the development needs of this sector are likely to make India's employment and livelihood issues even more challenging. . thus this sector should not be ignored by the government as the present scenario is. Though agriculture sector¶s contribution to GDP has remained stagnant. we conclude that yes. industrial and service sector can definitely solve the issue of unemployment in India to a large extent by effectively implementing measures discussed before and not forgetting to take agriculture sector in consideration. . Can industrial and service sector solve the problem of unemployment in India???? Hence. Thank you .