The Agneepath protests highlight India's growing unemployment crisis.
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Recently, the National Democratic Alliance (NDA) government's foresighted initiative Agneepath scheme for short-term recruitment (4 years service military service) in Indian Armed forces, faces a backlash by the opposition parties and ani-national elements through a series of violent protests in several parts of the country. The protests, which first erupted in Bihar on June 16, soon spread like wildfire across 15 Indian states, causing extensive damage to public property and disrupting day-to-day life. Ultimately, the government successfully quelled the protests through a combination of concessions and heavy police action. The central government was completely taken aback and was surprise by the nature and intensity of the agitation, as the expectation were to create confidence in Indian youth, however the opposition parties had different plan. What do these agitations against Agneepath Yojana indicate? Why do so many young people resist the supposedly attractive option of training and employment opportunities, albeit temporary, but good exit rewards?
The protestors (mostly paid protestors and religious extremists) believer that the jobs being offered do not have the social status or economic benefits of a regular job in the armed forces, which is their belief and could totally be wrong.
A major concern for the violent protests across the nation was the temporary nature of the job with none of the post-retirement benefits that regular armed forces jobs offer, especially the pension offered by the armed forces after successful completion of the service, along with additional perks. The fact of the matter is that many aspire to a military job because of the social status, prestige, and attractive retirement benefits. However, with a tenure of four years, no medical and no retirement benefits (even for the 25 percent who will join the army as regular cadre), for some it is extremely disappointing. And most importantly, only a quarter of those will be absorbed into mainstream regular armed force service. However these protestors are far from reality and reality of "Agneepath Scheme" seems way lucrative then the way it is painted by the protestors.
Increasing Job Crisis
Agneepath protests must be seen in the context of the growing crisis of jobs in all sectors; public and private. According to a recent report by the Center for Monitoring Indian Economy (CMIE), by the end of December 2021, the share of salaried workers was only 19 percent of all employed persons (down from 21.2 percent in 2019-20). Statistically speaking, as many as 9.5 million salaried jobs were lost during this period. Ironically, as many as 1 million jobs among entrepreneurs were lost. In the meantime, a large number of jobs have been created, most of them low-wage jobs in sectors such as construction, agriculture, and other low-paying jobs. While there are signs of recovery, India's most recent labor statistics paint a grim picture. According to Mahesh Vyas, Managing Director of CMIE, Employment in India fell by a massive 13 million to 390 million from 404 million in May. By far, this was the largest drop in employment in a non-lockdown month. According to him, employment in June was the lowest in the last 12 months.
Recruitment and employment opportunities across all verticals has declined sharply for last 5 years than a decade, particularly in regular and relatively high-paying manufacturing jobs. Beyond numbers, the real issue in private sector jobs is the quality of jobs, and lack of skilled labours.
A Stable Private Sector
The private sector, which has been the mainstay of new jobs in the last three decades, especially since economic reforms began in the early 1990s, is currently going through a tough phase. Recruitment across all verticals has declined sharply for last, particularly in 5 years, particularly in regular and relatively high-paying manufacturing jobs. Beyond numbers, the real issue in private sector jobs is the quality of jobs, and lack of skilled labours. Contrary to the popular belief that MNCs are well paid and the market salary structure is limited to a small percentage of employees. Low wage workers overwhelmingly dominate private sector workers. What makes private sector jobs even more attractive is contracting with little social security cover. The issue of employment security has increased during the Covid-19 pandemic. Nearly 11 million jobs were lost in 2021 following the outbreak of the Covid-19 pandemic and subsequent lockdowns and related restrictions. Major sectors such as aviation, travel and hospitality took major hit.
Attractiveness of Government Jobs
Security of tenure ensured that government employees remained largely immune to the impact of the pandemic and the resulting economic downturn. What government employees are safeguarded from without job security is relatively high pay. For example, according to the Periodic Labor Force Participation (PLFP) data (2019-20), while the monthly average government salary is around INR 28,000, the salary in private companies is in the range of INR 17,000.
According to subject matter expertise in labour market Sonalde Desai, comparing males with 10-12 level education, government sector employees earn as much as INR 25,000 per month, while those in the private sector earn around INR 12,000 per month. Beyond the relatively high remuneration, public sector employees are entitled to many other benefits including provident fund/pension, gratuity and medical expenses. Majority of private sector employees rarely get these benefits.
There is more to government jobs than financial benefits. Government jobs offer great opportunity for status, social prestige and social mobility. As analysts rightly point out, government jobs give individuals a new professional identity of “government official”, which is deeply empowering. Further, relaxed terms and conditions, security of tenure and regular upward revisions in government job salaries (Pay Commission) have imprinted a market-less society mentality.
Beyond the relatively high remuneration, public sector employees are entitled to many other benefits including provident fund/pension, gratuity and medical expenses.
Yet, the harsh reality is that only a few jobs have been added in the public sector over the past decades. This is further evident in the dire statistics of new recruits. While the central government recruited nearly 119,000 people for permanent jobs in 2020, the number dropped to 87,423 in 2021. At the state level, the situation remained even more uncertain. In 2020, states recruited as many as 496,052 persons, while in 2021, the number dropped to 389,052 persons. Although much of this has to do with the Covid-19 pandemic, the recruitment rate of many key government departments has continued to decline. Big recruiters. For example, Indian Railways, one of the largest job providers, has eliminated 72,000 posts at various levels. Also, army recruitment has been suspended for the past two years due to the pandemic. Not only has recruitment in government departments declined drastically, which they were not ready.
Conclusion
Although key policymakers in the government were taken aback by the nationwide protests triggered by violent incidents against a supposedly lucrative scheme like Agneepath, they must not have missed the warning signs over the years. With the steep decline in private sector employment, especially job quality and declining tenure security, youth have increasingly looked to government jobs. This is reflected in the recent record number of eligible youth (15 million) applying for a few thousand D-grade jobs in the railways and numerous violent protests in Bihar and Uttar Pradesh over delays in railway and army recruitment. Despite this, no efforts are seen from the government and other stakeholders.
Taking cognisance of this crisis, the central government recently announced to recruit one million people in mission mode in next 18 months. Although this is a welcome step, this is still a drop in the ocean given the unemployment rate and the current demographic growth in India. Today, the working age population is larger than our dependent population. Two-thirds of Indians today are of working age. In short, before the large number of people take to the streets in recent times, all standing governments should take serious note of the growing jobs crisis and youth discontent.
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