Punjab must prioritise employment, employability to turn the tide

BS Ghuman

Former Vice Chancellor, Punjabi University, Patiala

THE India Employment Report 2024: Youth Employment, Education and Skills, published recently by the International Labour Organisation and the Institute for Human Development, has reignited the debate on employment and unemployment. Much of the discourse has focused on the national scenario. A perusal of the report reveals wide state-wise variations.

State differentials have been highlighted by constructing an employment condition index based on seven indicators: percentage of workers employed in regular formal work; worker-population ratio; proportion of casual workers; proportion of self-employed workers with income below poverty line; average monthly earnings of casual workers; unemployment rate of the youth with secondary or higher level of education; and youth not in employment, education or training. The index ranges from 0 to 1, with ‘1’ depicting the best scenario and ‘0’ the worst.

In the case of Punjab, the index was 0.45 in 2005; it improved to 0.54 in 2012, fell to 0.48 in 2019 and rose to 0.53 in 2022. States like Himachal Pradesh, Uttarakhand, Telangana, Rajasthan, Gujarat, Haryana, Tamil Nadu, Maharashtra, Karnataka and Madhya Pradesh have fared better than Punjab. The state’s position has worsened over time. Punjab was ranked 13th in 2005 and 16th in 2022. Its performance fell below the national average in 2019 (0.5) and 2022 (0.65). The decline in the index ranking of Punjab is due to overall deterioration of employment conditions, particularly among men. For example, the male employment index was 0.52 in 2005 (the state’s rank was seventh); it dropped to 0.5 in 2022, pushing the state to the 18th position.

In Punjab, the rate of unemployment among educated youth (aged 15-29) has increased over the years. From 22.95 per cent in 2005, it jumped to 26.33 per cent in 2022. The rate among the male youth witnessed a considerable increase from 13.95 per cent in 2005 to 22.63 per cent during this period, while in the case of females, it declined from 52.94 per cent in 2005 to 39 per cent in 2022. The unemployment rate among the educated youth is likely to increase due to stringent conditions imposed by the Canadian Government on international students and fixing of students’ quota province-wise.

Factors pertinent to the demand and supply sides are causing unemployment. On the demand side, the situation is not very buoyant as Punjab’s economy grew at a moderate rate of 5 per cent per annum between 2011-12 and 2021-22, which was lower than that of Gujarat, Karnataka, Andhra Pradesh, Madhya Pradesh, Odisha, Haryana, Telangana, Tamil Nadu, Himachal Pradesh, Rajasthan, Uttar Pradesh and the all-India average. In the agriculture sector, the demand for labour is declining as the employment opportunities are shrinking, mainly due to mechanisation. The industrial sector is dominated by small units, which offers mediocre jobs at low wages much below the expectations of the local youth. In the service sector, wages are slightly better, but still below the aspirations of the educated youth. In distress, the youth either migrate to other parts of the country or abroad for jobs; in the latter case, they sometimes become victims of unscrupulous travel agents.

On the supply side, each year, a large number of young people are entering the workforce. Punjab had 79 lakh youth in 2021, constituting 39 per cent of the working population. Around 36 lakh students were enrolled in senior secondary schools, higher learning institutions, polytechnic and industrial training institutes during the 2022-23 session. The employability rate of the students, however, is very low. According to an estimate, around 10 per cent of the general graduates and 25 per cent of the technical graduates are employable. The remaining are added to the pool of unemployment.

What is the way out? In Punjab, the youth account for 39 per cent of the working population; this will decline to 30 per cent by 2036. Thus, for reaping benefits of the demographic dividend, the government should prepare a comprehensive employment policy in consultation with experts, professionals and stakeholders. The policy should have short-, medium- and long-term employment generation targets with a provision for a monitoring mechanism. Yearly progress should be put in the public domain for social auditing. Also, the government should explore the possibility of exporting skilled human resources to labour-deficient countries by signing memoranda of understanding (MoUs). The MoUs should be implemented by the Department of Employment Generation and Training. This route, being economical and secure, will provide opportunities to talented youth from poor families for overseas jobs. In the light of the growing number of technical graduates and their aspirations for high-quality jobs, the government should incentivise setting up of industries in the fields of smart technologies, knowledge and high-value services. Educational institutions should introduce courses in the sunrise sectors, particularly relating to emerging technologies. For improving the employability of the graduates, the institutions should integrate general education with vocational education, as recommended by the National Education Policy, 2020. Finally, the youth should come out of their comfort zone and participate actively in the Startup India Programme, along with the Startup Punjab Programme and self-employment policy initiatives. Notably, Punjab was among the top-performing states in the fourth edition of the states’ startup rankings, covering the period from August 1, 2021, to December 31, 2022, suggesting huge potential of this mode of employment generation.

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