Indians struggle to find employment despite economic growth

Despite India’s continuous economic growth, there is an interesting trend occurring. The trend is that the nation’s youth are increasingly looking towards government jobs. The allure lies in the perceived security these jobs offer. A resident of Uttar Pradesh, India’s most populous state, shared that he has attempted to secure a government job 13 times without success.

India’s booming population exacerbates the challenge of securing government employment opportunities. Between 2014 and 2022, government figures indicate that 220 million people applied for federal jobs, with only 722,000 successfully selected. Many applicants make repeated attempts every year, highlighting the intense competition for these positions despite the expanding private sector and overall economic growth.

This trend demonstrates the cultural and economic anxieties prevalent amongst many Indians. Despite residing in the world’s fastest-growing major economy, a substantial portion of the population faces an uncertain job market with limited opportunities for stable employment. Government jobs are perceived as offering greater security compared to positions in the private sector. Adding to the challenge for aspirants is the age limit for government job eligibility. Candidates over 35 years old are ineligible to apply for civil service exams, further narrowing the window of opportunity.

Since 2014, India’s GDP has grown from $2 trillion to nearly $3.5 trillion in fiscal 2023-24, with an expected expansion of 7.2% in the current year. Despite this economic growth, job seekers argue that government positions provide lifelong security, health benefits, pensions, and housing, which are often perceived as lacking in private sector employment. There is also an unspoken belief that certain government roles may involve opportunities for additional income.

Less than half of India’s 950 million working-age population are employed, a stark contrast to the 70% employment rate seen in other emerging markets. The situation is further complicated by the fact that a significant portion of employed individuals are self-employed, including unpaid family helpers, according to the Periodic Labor Force Survey. In 2023, only 32.7% of working-aged women participated in the workforce.

A study by the educational testing services firm, Wheebox revealed that only 51.25% of 388,000 college graduates were deemed “employable” based on skills-assessment tests conducted in collaboration with Harvard Business School. The report underscores the urgent need for India to generate between 90 million and 115 million jobs by 2030 to sustain its economic growth trajectory.

During the COVID-19 pandemic, urban unemployment in India peaked at 20.9% in the April-June 2020 quarter, accompanied by a decline in wages. While the unemployment rate has since decreased, the availability of full-time positions remains limited. Many job seekers, particularly young adults, are increasingly settling for low-paying casual work or resorting to unstable self-employment, despite India’s robust economic growth projected at 6.5% for the financial year ending March 2024.

India’s high population growth has been identified as a significant factor contributing to dwindling job opportunities. With over 1.4 billion people, India has surpassed China to become the world’s most populous nation. Approximately 53% of its population is under 30 years old, representing a much-touted demographic dividend. However, without sufficient job opportunities, millions of young Indians risk becoming an economic burden rather than an asset.

The India Employment Report 2024, jointly created by the Institute for Human Development and the International Labour Organization (ILO), highlights that while India’s working population has increased, youth participation in economic activities declined to 37% in 2022. The report stresses the critical need for sustained vigilance and effective policy measures to stimulate job creation and secure the nation’s future prosperity.

According to the latest data from the Centre for Monitoring Indian Economy (CMIE), an independent think tank, India’s unemployment rate stood at 9.2% in June 2024, up from 7% in May 2024, reflecting ongoing challenges in the job market.

Analysts cite discontent over employment opportunities as a significant factor contributing to Prime Minister Narendra Modi’s party failing to secure a majority in the April-May general election, returning to power only with coalition support. Government data indicates that while 20 million new employment opportunities were created annually since 2017/18, much of this growth stemmed from self-employment and temporary agricultural hiring rather than formal, salaried positions.

Earlier this year, nearly 5 million students applied for 60,000 vacancies in the Uttar Pradesh police force, while an exam for constable positions in central government security agencies saw 4.7 million applicants for 26,000 posts. Similarly, an application process for government department positions, including roles like office assistants and drivers, drew close to 2.6 million applicants in 2023 for approximately 7,500 jobs. Across all government levels, including the armed forces, schools, health services, and the military, nearly 6 million positions remain unfilled, according to estimates by India’s main opposition party, the Indian National Congress.

The clamour for government jobs reflects not only employment attitudes but also the challenging realities of India’s job market. Rituparna Chakraborty, co-founder of staffing firm TeamLease Services, emphasised this point in various media discussions.

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