By comparison, an average of 8.5 million jobs were created annually between 1999-2000 and 2022-23According to a report released on Wednesday, India will need to add around 10 million jobs annually between 2024-25 and 2029-30 for India to maintain an average annual gross value added (GVA) growth of 6.5%.
By comparison, an average of 8.5 million jobs were created annually between 1999-2000 and 2022-2023.
About 196 million jobs have been created over the past 23 years, with nearly two-thirds of them created between 2012-2013 and 2022-2023, according to the report titled “What’s Driving Job Growth?” – Navigating Sectoral Shifts in Indian Labor Markets,” by Goldman Sachs.
Between 2019-20 and 2022-23, an average of 26 million jobs were added annually due to an increase in employment in agriculture and services. “Job creation in agriculture was helped in part by workers migrating back to rural areas during the pandemic, supported by additional government subsidies that created a safety net for these workers,” the report said.
Within the service sector, business services and retail or wholesale have contributed most to job creation over the past twenty years. Business services include management consulting services and scientific research and development.
The report’s analysis is based on the Reserve Bank of India’s (RBI) KLEMS database and the Periodic Labor Force Survey (PLFS).
While manufacturing employment fell by an average of 0.2 million jobs per year between 2012-13 and 2016-17, coinciding with a weaker investment cycle, employment increased by an average of 2.4 million per year between 2020-21 and 2022-23 . This was mainly due to the Production Linked Incentive (PLI) schemes introduced by the government in 2020, the report said.
Over the past decade, capital-intensive manufacturing sectors such as chemicals, machinery, etc. have recorded stronger employment growth compared to labor-intensive sectors such as textiles and footwear, food and beverages.
India’s dependency ratio will be one of the lowest of any major economy over the next twenty years.
Until 2035, the working age population will remain around 69% and gradually decline to below 60% by 2050. report highlighted.
Three policies are proposed for job creation in the country: “encouraging the development of affordable social housing,” as the real estate sector employs over 80% of the workforce in the construction sector; expanding IT hubs and global capacity centers (GCCs) to tier 2 and tier 3 cities; and reallocating fiscal incentives to support labor-intensive manufacturing sectors.
According to the PLFS survey, the labor force participation rate (LFPR) has increased over the past six years, largely due to an increase in women’s participation, especially in rural areas.
