Around 150 years ago, British PM Benjamin Disraeli said: “There are three types of lies ~ lies, damn lies, and statistics” ~ a statement as true today as it was the day it was made. A recent example would suffice. Almost a week ago, Citigroup published a report stating that for India, a 7 per cent GDP growth rate would provide only 80 to 90 lakh jobs per year, against a requirement of creation of 1.2 crore jobs annually. Hardly, a day had passed, when the RBI came out with a report claiming that the country had added 4.67 crore jobs in Financial Year 2023-24, and employment had grown by 6 per cent in FY 2023-24, as against 3.2 per cent in FY 2022-23.

Soon enough, the Labour Ministry waded into the controversy, claiming that 8 crore new jobs had been created between 2017-18 and 2021-22 ~ regardless of the fact that 2020-21 and 2021-22 were Covid years. On the other hand, according to the Centre for Monitoring Indian Economy (CMIE), the unemployment rate rose to 9.2 per cent in June 2024 from 7 per cent in May 2024. Also, the unemployment rate, which was 7.5 per cent in FY 2022-23, rose to 8 per cent in FY 2023-24, with 3.7 crore people actively looking for a job in FY 2023-24. Relying on Citigroup and CMIE statistics, Opposition parties claimed that India was facing an employment crisis, while relying on the RBI report, Prime Minister Modi emphatically retorted that creation of eight crore new jobs in the last three to four years had “silenced” those spreading fake narratives about unemployment.

Surprisingly, all these mutually contradictory reports were compiled by learned economists and statisticians, and much ink has been spilt in trying to reconcile their seemingly irreconcilable conclusions. It has been charitably suggested that RBI had classified underemployment in the agricultural sector as gainful employment, leading to inflated employment figures. However, not employment statistics alone, but crucial economic and social data like monthly GST collections and the decennial census have all been discontinued by the Government.

A consequence of discontinuance of Government data on employment in 2017-18 is that most discussions on unemployment get side-tracked into a debate about reliability of data, which only creates acrimony and suits no one. In an article in a leading newspaper on 28 April 2018, relying on CMIE data, a member of the Prime Minister’s Economic Advisory Council, concluded that 15 million jobs were created in 2017, as against an average of 4 million jobs per year in UPA times. Shortly thereafter, in another article in the same newspaper, the Managing Director of CMIE, observed that the claim of creation of 15 million jobs was absolutely false; rather incomparable data sets, cherry-picking, and dubious statistical analyses were behind the claims of robust employment growth.

According to the MD, only 1.4 million jobs were added in 2017. Again, on 2 May 2018, in an article in another newspaper, a former Vice-Chairman of NITI Aayog, claimed that instead of the generally accepted figure of 12 million job entrants in a given year, the number of job entrants was only 7.5 to 7.8 million per year. This naturally left everyone confused; all economists involved in the debate were highly respected, yet all were canvassing diametrically opposite conclusions, like historians debating the outcome of the battle of Haldighati. Moreover, a conjoint reading of what both Government economists had written would have us believe that job creation was galloping at twice the rate at which jobseekers were entering the job market.

Significantly, at that time, too, the Government came out with a rejoinder, warning people against relying on ‘private’ data. However, looking at the available data holistically, our demographic dividend that envisages India’s working-age population growing by roughly 9.7 million per year, during 2021-31, could have frightening consequences for our society. Anecdotal evidence does suggest that we are facing an employment crisis ~ IITs are reporting below normal placement, and many engineering and management colleges have closed down. Underlining the lack of suitable job opportunities, instances abound where advertisements for some few posts of constables and peons, had got thousands of responses, with many applicants having engineering, MBA, and post-graduate qualifications. Recently, in UP, 50 lakh applications were received, in response to an advertisement for 60,000 constables.

Unfortunately, the question paper was leaked, leading to cancellation of the examination. This is a continuing trend; more than 4 crore applications were received for 2, 83,747 vacancies notified by the Railways in 2018-19. Later on, around 1.25 crore candidates applied for 35,000 odd vacancies in the Railways for Non-Technical Popular Categories. There was a sad aftermath; violent protests derailed the entire recruitment process. Sadly, the Railways had collected thousands of crores 0f rupees from applicants, by charging fees between Rs.500 to Rs.2,500, yet very few of them could get employment. All along, the Government has claimed that all was well on the employment front, but undeniably, the quality of employment on offer has declined significantly; salaried jobs have declined, the number of business persons has declined, and so has the number of small traders and daily wage labourers.

Rather, in a denouement of classical economic theories, which posit that as countries develop, people steadily move from the primary sector (agriculture) to the secondary sector (manufacturing) and then to the tertiary (services) sector, the Indian economy is seeing a movement in the reverse direction ~ the decline in employment in the secondary and tertiary sectors was accompanied by an increase in the number of farmers, by nearly 10 per cent. Presently, most of the jobs offered in the private sector are not conventional jobs, but ‘gig’ jobs ~ those jobs for which workers are paid for each individual gig (piece of work) they do, instead of monthly salary/day’s wage/hourly wage ~ like drivers for Ola and Uber, delivery boys for Amazon, Swiggy and Zomato, and repairmen for the Urban Company. “Gig workers” reduce operational costs for companies but “gig” jobs are like slow poison for workers, because “gig” workers work for extremely long hours in pitiable conditions.

Labour laws classify “gig” workers as independent contractors, which means they have no fixed working hours, no protection against unfair dismissal, no right to redundancy payments, and no right to receive the national minimum wage, paid holidays or sickness pay. The downside for employers is that gig workers cannot be relied on for confidentiality and proper teamwork, but following in footsteps of the private sector, Government is also outsourcing its ministerial and menial work in a big way, resulting in poor service to the public, and reducing job opportunities. What are called “gig” jobs today were more correctly classified as underemployment by economists like Keynes. Learning a lesson from the rampant underemployment during the great Depression, the US Bureau of Labour Statistics calculates the “Underemployment Rate” every month from 1948.

Regrettably, underemployment is not recognised as an issue in India, hence no underemployment statistics are maintained by the Government. Maybe, for this reason, our leaders treat jobs created by the “gig” economy on par with regular jobs, little realising that a rising level of “gig” employment is a symptom of a disbalanced economy. “Skill India” and “Make in India” can be excellent catalysts for employment generation but the outcome has been sub-optimal, because the Government appears to care more for headline numbers, planning to achieve a $5 trillion economy, by subsidising big business. The latest Government initiative, Production Linked Incentive (PLI) envisages a subsidy of Rs 1.76 lakh crore for manufacturers in various spheres, none of which are labour intensive. A much larger number of jobs would have been created by investing the same amount of money in rural jobs and infrastructure.

A long-term strategy could be to link our education system to requirements of trade and industry, ensuring that a student coming out of the education system has requisite skills for the jobs on offer, and there is no oversupply in any discipline. The New Education Policy (NEP) does have a commendable intention of promoting vocational education, but given the paucity of vocational institutes, a short-term strategy is also required. Probably, the Government could step in, with a well-structured employment generation programme, to ameliorate the misery of unemployed and underemployed youth. Oliver Goldsmith correctly foresaw the consequences of large-scale joblessness, two and a half centuries ago, writing: “Ill fares the land, to hastening ills a prey, Where wealth accumulates, and men decay”

(The writer is a retired Principal Chief Commissioner of Income-Tax)