Unemployment in India has become one of the biggest issues today. According to India Employment Report 2024, 1 out of 3 youths in the country is unemployed. The unemployment rate has reached 29.1% among those who already have a graduate degree. The question here is, why is this happening?
Our country has 1.4 billion people, meaning there is no dearth of basic necessities for people. India is a huge market. Foreign companies come here and earn millions and billions in profit.
PepsiCo’s latest ROC filing shows that its annual revenue in India is ₹80 billion. Coca-Cola India’s yearly revenue is more than ₹128 billion. But the youth in our country can’t even get a job with a ₹12,800 salary. How is it possible?
India has now become the 5th largest economy. And we are being told that soon we will become a $5 trillion economy. But in this economy, there aren’t any jobs for you. Who has taken away your jobs? Your livelihoods?
Government
Prime Minister Modi had promised one crore jobs if his government came to power in the 2014 Lok Sabha elections. He made a similar promise again for the 2019 elections and again for the 2024 elections.
In Haryana, BJP ran the ad, taking a jibe at Congress, “Those who kept the youth unemployed, the public will not forgive you. Let’s change the situation and the country’s government.“
Unfortunately, Haryana is number 1 today in terms of unemployment. According to the December 2022 CMI data, unemployment in Haryana is at 37.4%. That means, in the whole country, unemployment is the highest here.
But it’s not just about Haryana; PM Modi went to many places and promised to provide jobs.
Eight years ago, he said, “We have launched the Make in India campaign. So that the youth can get employment in their localities and sit with their parents at the end of the day.”Â
7 years ago, the PM talked about 1 billion jobs. He said, “Our aim is to create jobs for more than a billion young hands.”
The mainstream news channels will either never talk about unemployment, or if they do, they will go to extremes to protect the government’s image. Take Sudhir Chaudhary, for example. He started blaming the citizens for seeking government jobs motivated by bribes.
In his show, he also claimed that the youth was not skilled enough. But who is responsible for this?
The government vowed to launch skill programs and make the youth employable and skillful.
Employment Situation
Let’s try to understand how many jobs are needed in our country. Per a 2021-22 report on the Ministry of Education’s website, the number of enrolments in higher secondary schools is 28.5 million.
According to the UDISE+ report, the dropout rate is 12.61% at secondary level, that is, after 10th grade. Before this, the dropout rate was 3% at the upper primary level, and at the primary level, it was 1.45%.
If you look at this year’s report, around 3.5 million students from the 10th grade could not get to the 11th grade. So if we consider the 12th pass,12th fail, and all these dropouts, the overall number will be around 33 million to 34 million.
Most of these 12th-pass students decide to study further in colleges. But do all our colleges nationwide have college seats to accommodate these tens of millions of people? The answer to this is simply no.
First, let’s take the example of medical education. In July 2023, our Minister of Health and Family Welfare told the Parliament that there are about 108,000 MBBS seats across the country. Apart from this, some seats are from BDS (Bachelor of Dental Surgery).
According to a Times of India report, the total number of seats, MBBS plus BDS seats, is around 140,000. However, the total number of applications for NEET UG in 2023 was more than 2 million.
That means if 15 people aim to be doctors, only 1 gets the college seat. There are even fewer PG seats – only 67,800. In our country, there’s an abundant supply of candidates who want to be doctors.
And, of course, there’s high demand, too. There is a severe shortage of doctors in our country. But the problem is that our government hasn’t built sufficient educational infrastructure in India. We lack colleges, universities, and educational institutes. There’s another side to this problem.
Half of the total medical seats in our country are in government medical colleges, and the other half are in private medical colleges. And the fees of private colleges are extremely high.
According to a Times of India report, D Y Patil Medical College in Mumbai offers the most expensive MBBS degree at ₹14 million. In December 2022, the Minister of State for Education presented information to the Parliament that the median fee in any private medical college in India is ₹1.15 million per year. That means the total fee to get the degree is almost ₹6 million.
The median fees for deemed universities are even higher at ₹2.1 million per year, bringing the total fees to more than ₹10 million. How many families in our country can afford this?
According to the State of Inequality in India report of 2022, 90% of Indians earn less than ₹25,000 per month. 90% of Indians cannot afford these college fees.
Since everyone does not want to become a doctor, let’s discuss engineers. In December 2022, our Minister of State for Education, Subhash Sarkar, told the Rajya Sabha that even though the Indian population is increasing, over the last five years, the total number of seats in engineering colleges has been decreasing.
In 2017-18, there were 1.465 million seats. By 2021-22, they had decreased to only around 1.253 million seats. But there is another aspect to this problem too.
In 2017-18, more than half the seats were vacant. In 2018-19, 48.6% of seats were vacant. Even in 2021-22, about 33% of seats, i.e., ~421,000 lakh seats were vacant. There was no shortage of supply here.
Millions of people in our country want to become engineers. But why are so many seats vacant in engineering colleges? There are four main reasons for this. First, the high fees. Over the last few years, the fees of colleges, including the IITs, have increased.
The fee hike in IITs doubled in 2016, from ₹90,000 to ₹200,000. For a 4-year B.Tech degree, it amounts to an additional ₹800,000. In private engineering colleges, the fee reaches up to ₹2 million.
Second, no matter how much you pay as fees, the quality of education, in most cases, is quite low. In most private engineering colleges, there are sub-standard faculties that are either paid very little or are not at all qualified.
As per the data by the Ministry of Education from June 2023, only 44.51% of the faculty in the engineering colleges across our country have a PhD. Only 55.49% have a Master’s degree.
Third, most engineering colleges have a shortage of faculty. Our education minister told Lok Sabha in 2022 that 4,500 faculty posts are vacant in our prestigious IITs. In the academic year 2021-2022, overall, 40.3% of teaching positions were vacant. If this is the case in IITs, how are the other engineering colleges in the country faring?
Fourth, most colleges do not have proper infrastructure. In 2019, AICTE decided that in all of the government engineering colleges, 40,000 seats would be reduced. Why? Because they did not have proper faculty or proper infrastructure. In 2022, Anna University conducted a physical inspection and found that in Tamil Nadu, more than 50% of engineering colleges do not have adequate infrastructure.
Last year, 37 engineering colleges in Tamil Nadu did not admit even a single student. When our country’s engineering colleges are in such a bad state, it is not surprising that most of the engineering graduates in our country are not employable.
In 2019, an employability assessment company, Aspiring Minds, published a report that shows that 60% of engineering graduates in India do not do an internship. And only about 3% of engineers have new-age technological skills in the fields of artificial intelligence, machine learning, data science, and mobile development.
As a result, more than 80% of Indian engineers are not employable. This is not because they are lazy or not good at their studies but because there is a shortage of engineering colleges in the country.
Students can choose something else. They can join an ITI. ITI means Industrial Training Institute, where you can learn a skill. It’s a great option, but how many seats are available there? The Minister of State for Skill Development and Entrepreneurship, Rajiv Chandrasekhar, told the Lok Sabha in December 2022 that there are around 15,000 ITIs. The total seating capacity is around 2.5 million.
150,000 for medical, 1.25 million for engineering, and 2.5 million for ITI; even if you add up all these seats, we’re not even at 5 million. However, the total number of eligible students in India is more than 30 million.
Where will the remaining millions of students go? What will they study? If we talk about the ITIs, out of these 2.5 million seats, like engineering, around 50% of the seats are vacant. And after graduating from ITIs, like engineering colleges, there is no job guarantee.
Most of the graduates are not employable. Even if we assume that all the available seats are filled up, top-quality education is provided for all the seats, and all the graduates have good skills, then will they get jobs?
Again, the answer is a straightforward no.
Employment Problem: Companies Laying Off Employees
July 2023’s CMIE data revealed that in India’s manufacturing sector, there were 51 million jobs in 2016. By 2023, this number had fallen down to 36 million. The number of jobs in the manufacturing sector has decreased by 30%.
On top of that, even currently employed people do not have secure jobs. Look at these reports from May 2020; according to the CMIE report, more than 120 million Indians lost their jobs after the coronavirus lockdown was imposed in April.
Further, by June 2021, 10 million people had lost their jobs during the second wave of Covid. 97% of household incomes declined.
In May 2023, the Indian Staffing Federation stated that 6% of contract workers had lost their jobs in the IT sector in India in the March quarter. In June 2023, more than 11,000 Indian startup employees were laid off. In August 2023, a layoff tsunami hit. Tech companies fired more than 200,000 employees from their jobs.
Engineering colleges are worried because companies like TCS, Cognizant, and Wipro have not resumed campus hiring. In October 2023, four of the top five IT companies had negative hiring numbers. Infosys, Wipro, HCL, and Tech Mahindra had negative hiring numbers. Only TCS’s hiring number was positive.
Indian economy’s GDP growth rate is not negative. Neither are these companies going into loss. If you look at TCS’s profit, their year-on-year profit growth was 9%, registering ₹113 billion in profit. If you look at Infosys’ quarterly profit before tax, ₹85 billion in profit.
These companies recorded profit in every quarter. But they don’t have jobs for people. The employees are being made to work overtime. More than half of the employees are on the verge of burnout.
According to a survey by the McKinsey Health Institute in 2023, India is at the top in terms of workplace burnout. 62% of Indian employees report workplace exhaustion. Japan comes in second with 61%.
This is not the only such report. There have been other reports before that have pointed out the same thing. Asian Mental Health Index report of September 2023. More than half of Indian employees feel exhausted from work. ILO report of February 2021. Indian workers work the longest and earn the least.
Not all companies do this, but this is the trend among most companies in the country. They don’t recruit new employees because their salary expenses would increase. They overwork their existing employees. And in case the employees aren’t overworked, they use cost-cutting and enhanced efficiency as excuses to do some more layoffs.
Many companies around the world do the same. Amazon, in the first three months of 2023, fired more than 27,000 employees globally. Meta, since November 2022, has fired 21,000 employees. Twitter, as per a report from December 2022, there are only 80 Twitter employees in India.
Engineers are being asked to work longer hours. There is a clearly evident pattern here. When a company grows beyond a certain limit, the job growth rate in that company will keep falling.Â
Adani Group’s market capitalization is ₹11 trillion. This is an enormous number. But how many employees are there in this company? According to their website, there are only 43,000 employees.
Look at the example of Coca-Cola. In December 2012, Coca-Cola told the US Securities and Exchange Commission that this company has 150,900 employees. Ten years later, in December 2022, Coca-Cola said that they had only 82,000 employees remaining.
The number of employees has almost halved in ten years. But the profit of this company increased by hundreds of billions of dollars.
Twitter’s market capitalization is $41 billion. That is ₹34 trillion. How many people does this company employ? Only 1,500.
One of the biggest companies in India, ITC owns more than 25 brands. Sunfeast Biscuits, Ashirwad Aata, Bingo Mad Angles, hotels like ITC Maurya, more than ten cigarette brands, and Classmate Stationery are all owned by this company. Their market cap is ₹54 trillion. But how many employees do they have? Only around 23,000.
Another famous name in the FMCG sector is Hindustan Unilever. They own more than 50 FMCG brands. Pepsodent, Close-Up, Lifebuoy, Dove, Pears Soap, Kwality Wall’s, Horlicks, Red Label, Brew Coffee, Surf Excel. Their market capitalization is ₹59 trillion. Their annual turnover is ₹580 billion. But there are only 21,000 total employees.
So the point here is that these private jobs, the jobs that you get after doing engineering, or MBA, the corporate white-collar jobs, are also extremely limited.
In February 2023, in a public function, RSS Chief Mohan Bhagwat said that everyone is running after jobs. Government jobs make up around 10% of jobs, and the other jobs are around 20%. And there is no society in the world that can create more than 30% jobs.
Segments That Deserve More Credit
In a conversation with Sudhir Choudhary, PM Modi once said that having a street food stall is also a form of employment. “If someone sells fritters outside your ZeeTV studio and, by the end of the day, earns ₹200, will you consider that person to be employed or not?”
The only question is if the government wants people to set up fritters stalls and do business, then why promise jobs? People often make fun of Gandhi’s spinning wheel, but when we talk about employment, we see that Gandhi’s spinning wheel provides more employment than these large-scale companies.
According to IMR group’s report, the size of the Indian handicraft market in 2022 was $3.9 billion. If converted to Rupees, it is around ₹320 billion. And can you guess how many people are employed here? 6.9 million people.
Compare it with Hindustan Unilever. There the turnover is ₹580 billion and employment is provided to 21,000 people. The size of the handicraft market is ₹320 billion and it employs 6.9 million people. 650 times more employment.
NITI Aayog’s reports have also pointed out the same thing. Even though the informal sector contributes only 50% to our National Product, but 90% of the workforce is employed there.
Cooperatives like Lijjat Papad and Amul should be given a lot of credit for generating employment on a large scale.
People praise large companies and rich billionaires and celebrate when someone becomes the richest man in the world. But in reality, if someone is generating employment for our country and helping this country grow, then it is our cooperatives and small and micro enterprises.
Every shopkeeper and every person who sets up a stall in the country should be given credit here. The decentralized economy and localized production create, in reality, job creation.
Solving For Unemployment In India
What does the government need to do to solve the problem of unemployment? First of all, vacancies should be filled. Even though there is a shortage of government jobs, at least the vacancies should be filled. The central government has more than 950,000 job vacancies, and different state governments have reported more than 6 million job vacancies.
From schools to courts to police to ministries, there are vacancies everywhere.
Second, there is a dire need to focus on education. The government schools, colleges, and institutes in our country need improved infrastructure. New educational institutes need to be set up across the country so that there are more seats.
Many people want to be skilled professionals in different fields. Coupled with that, there is also a huge shortage of skilled professionals in the country. However, to bridge the gap between demand and supply, there are no educational institutes.
Third, the government needs to take action on a large scale to promote cooperative and small and micro enterprises. There are good economies in cities like Delhi, Mumbai, and Bangalore. But if we talk about remote districts, Madhya Pradesh’s Gwalior and Haryana’s Jeend, who will provide jobs here?
Will the poor people here need to wait for a day when some billionaire will look at them and set up factories to give them jobs? This mindset needs to change. The government will have to intervene here.
Right now, the government only provides loans, but it will have to provide means of production, storage space, and market mechanisms. When the Great Depression struck America in 1929, or the stalemate brought by Mao Zedong in China, or the slum-like conditions in Singapore in the 1960s, all this were handled simply after the government intervention.
Without government action, it is very difficult to improve upon. In India, Pandit Jawaharlal Nehru has also set up many public sector undertakings. He nationalized LIC and many other banks, which resulted in employment for many people.
The White Revolution turned milk-deficient India into the largest producer of milk. It happened only when the government intervened. Why could Hyderabad become an IT hub? Because the government intervened.
Fourth, the people selling street food have their own importance, and so do the engineers. But when the Prime Minister tells you to start a street food stall, what has the government done to promote it? The price of gas cylinders and oil have skyrocketed, and in the name of employment, the government has reduced corporate tax from 30% to 22% in 2019.
Because of this, in only one year, our country lost more than ₹1 trillion. If the government gets some time from getting kickbacks from billionaires, perhaps it might look at small businesses.
They need to be encouraged if we want to have more jobs in the country.
What Can You Do?
Make yourself more employable. You cannot wait for the government to take some action and give you a job. You can start working towards it right now.
Step 1: Delete all the gaming and social media apps on your phone. These waste your time. You need to understand that whether there are government jobs or not, whether there are private jobs or not, you are the one who has to do something.
Step 2. Learn a skill. It can be any skill, whether you watch cooking videos on YouTube or learn to cook. After watching that, you can start a cloud kitchen from your home. You can make tiffins for people or bake birthday cakes. You can set up a stall to sell fritters or tea. If you are not confident about starting your own business, you can work with another salesperson. Go work at a jewelry shop to learn how to design jewelry. Find a handicraft worker and work with them.
Instead of sitting at home and scrolling on Instagram, instead of wasting time on betting apps, look around you; there are so many different jobs you can learn from people who are working on it. No work is insignificant if it is done with sincerity and dedication. If you are sincere, you will do the work, and soon, you will develop the confidence that you can start your own business. But to be able to do anything, you have to start first.
