Policy Watch: Growth with Employment – March 2023

This issue of Policy Watch deals with the theme Growth with Employment. In particular, we focus on the issue of youth unemployment. India also has the second largest labor force in the world, with 476.6 million workers. India is slated to become the third-largest economy, surpassing Japan and Germany, by 2028, if not earlier. Despite this growth, the Indian economy is not able to absorb the millions of new workers that are entering or are poised to enter the workforce. Over 42% of 100 youth workers do not find jobs in their desired field of work. That is approximately 73 million unemployed young people.

The first article is by T. Navin of the Institute for Livelihood Research and Training (ILRT) and it is based on a field survey of unemployed youth in four cities of Chhattisgarh – Raipur, Durg, Bhilai, and Bilaspur. He found that about 30% of the youth preferred employment in government or public sector and another 29% preferred employment in the private sector. About 40% preferred to undertake self-employment.

The second article, by Vivek Saxena and Sharmila Ronanki, is based on a study commissioned by the Rajiv Gandhi Foundation, to understand the issues of youth unemployment and various pathways to self-employment, as gig workers and as micro-entrepreneurs. Towards this, they conducted a field survey of both categories of youth workers and their study yields a lot of insights on both categories. For gig workers, uncertainty of income was a big deterrent, even though the average income was higher than those wage employed more traditionally in construction or factory jobs. For the micro-entrepreneurs, access to start-up and growth capital was a major issue. The undersigned has been working on this and two video links of that are also included in the article.

The final article by Dr Rakesh Malhotra is based on an end-of-project impact assessment of the Rajiv Aajeevika Samvardhan Abhiyaan (RASA), a program for promoting micro-entrepreneurs that was launched by the RGF in the middle of COVID in about 30 districts in eight states, covering 1500 aspiring micro-entrepreneurs. The distinguishing feature of this program was the intensive use of the Achievement Motivation paradigm pioneered by Harvard psychologist David McClelland. We were fortunate to have one of the world’s best Achievement Motivation trainers Dr Deepankar Roy working in this program with us. As the impact assessment report shows, it has had a very high success rate, despite the fact that no financing support was given.