The spectre of unemployment looms large over India, casting a shadow of uncertainty and concern over the nation’s economic landscape. Renowned economist Kaushik Basu, former Chief Economic Advisor (CEA) to the Government of India, has sounded the alarm on this pressing issue, drawing attention to the findings of the India Employment Report 2024, a collaborative effort between the International Labour Organisation (ILO) and the Institute of Human Development (IHD). In a thought-provoking commentary shared on X (formerly Twitter), Basu underscored a troubling trend: the disproportionate rise in unemployment among educated youth, highlighting the profound implications of cronyism and the erosion of trust within the socio-economic fabric of the nation.
The statistics paint a stark picture of the unfolding crisis. According to the latest data, the labor participation rate (LPR) in India surged to 41.4% in February, reflecting a gradual uptick from the previous month. Concurrently, the employment rate, which measures the proportion of employed individuals within the working-age population, edged marginally higher to 38.1%. However, these seemingly positive indicators are juxtaposed against a sobering reality: a significant escalation in the unemployment rate, which soared to eight per cent in February 2024, marking a substantial increase from 6.8% in January of the same year.
Digging deeper into the demographic nuances of unemployment, a tale of two Indias emerges. While urban centres experienced a modest alleviation in unemployment rates, rural areas bore the brunt of the crisis, grappling with a pronounced escalation in joblessness. The rural unemployment rate skyrocketed to 7.8% in February, up from 5.8% in January, underscoring the entrenched disparities between India’s urban and rural economies. Amidst these disparities, the plight of educated youth assumes particular significance, with Basu’s analysis revealing a disconcerting reality: the share of unemployed individuals possessing at least a secondary education has nearly doubled from 35.2% in 2000 to a staggering 65.7% in 2022. Moreover, a staggering 83% of the total unemployed population in India comprises young individuals, signalling a crisis that disproportionately impacts the nation’s burgeoning youth demographic.
Beyond the realm of statistics lies a deeper narrative—one that speaks to the systemic challenges entrenched within India’s education system. Despite concerted efforts to expand access to education, persistent gaps in quality and relevance persist, particularly in less affluent regions and among marginalised communities. The disconnect between the curriculum and real-world learning outcomes reflects a broader malaise—a crisis of educational efficacy that threatens to undermine the aspirations and potential of India’s youth.
In the face of these formidable challenges, Basu’s commentary serves as a clarion call for introspection and action. The imperative for comprehensive reforms, spanning education, employment, and governance, has never been more pressing. As policymakers and stakeholders grapple with the multifaceted dimensions of the unemployment crisis, Basu’s insights provide a roadmap for meaningful change—a vision of an India where opportunity is not a privilege reserved for the few, but a fundamental right accessible to all. It is a vision that demands concerted effort, unwavering commitment, and a steadfast belief in the transformative power of collective action. Only then can India realise its full potential and chart a course towards a future of prosperity, equity, and inclusive growth.
