FM addresses job creation in the Union Budget 2019
The interim Union Budget 2019 attempted to alleviate the unemployment crisis plaguing India to a certain extent. Ironically, a report was leaked just yesterday, allegedly revealing that the unemployment rate in India stood at a 45-year high of 6.1 per cent during 2017-18! The government refuted this by stating the study conducted in December 2018 was yet to be approved. This has created much speculation and controversy.
The dearth of high-paying jobs in India is a grave concern, particularly since labour productivity has improved. The unemployment rate stood at 7.8 per cent in urban areas as compared to 5.3 per cent in rural areas. Furthermore, the labour force participation rate spiraled to 36.9 per cent in 2017-2018 from 39.5 per cent in 2011-2012. The wages paid to low-skilled labour dropped to Rs. 10,300 per month in 2018 from Rs. 13,300 per month in 2014. On an average, 82 per cent of male and 92 per cent of female workers earn less than Rs 10,000 a month. This calls to attention India’s harsh income inequalities. Since a vast majority of Indians do not earn what may be termed a living wage, the scuffle to secure government jobs is not entirely surprising.
According to FM Piyush Goyal, high growth and formalisation of the economy has led to an increase of two crore in the EPFO membership.
The Ayushman Bharat Programme was given special emphasis as the initiatives under it are likely to scale up employment opportunities, particularly for women.
The Central government proclaimed its proposal to launch a mega pension scheme for workers in the organised and unorganised sectors with a monthly income below Rs. 15,000, after 60 years of age.
The scheme called the Pradhan Mantri Shram Yogi Mandhan will award workers in the unorganised sector a pension of Rs 3000 per month after 60 years of age. The workers are required to contribute Rs 100 per month. The government will contribute a matching share to the employees’ contribution. The monthly contribution will vary based on the age of entry. Low-income category workers like plumbers, electricians, drivers and barbers are likely to benefit from the scheme. The move is supposed to benefit over 10 crore workers in the unorganised sector, and may well be the world’s biggest pension scheme for the unorganised sector in 5 years. However, it will significantly increase the burden on the government due to the massive scale of potential beneficiaries under the scheme. The current minimum pension in the organised sector stands at Rs. 1,000 per month.
The scheme has been launched this year with the government allocating Rs. 500 crore for the purpose, with an assurance of additional financial support, if required.
The government has undertaken several targeted steps to strengthen the MSME sector, which provides employment to a major chunk of the population. The entertainment industry is also a major employment creator. Thus, single window clearance for ease of filming has been made available to Indian filmmakers, whereas earlier it was available only to foreign filmmakers. The budget awarded special benefits and incentives to small businesses and start-ups. The compliance processes were simplified.
In conclusion, the government impetus to education, housing and infrastructure is likely to scale up employment opportunities. With the country embracing next-generation technologies like artificial intelligence and the developments in the aviation sector, the demand for highly-skilled and qualified people is increasing. However, the extent to which the budget will ease the unemployment crisis remains to be seen.