India: Leaked NSSO report revives jobs debate, puts BJP on the back foot

  • Just months ahead of the next Lok Sabha elections, the growing debate over jobs is back to haunt the Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA).
  • The immediate trigger was a report by the National Sample Survey Office (NSSO) which pegged India’s unemployment rate in 2017-18 at 6.1%—a 45-year-high. The contents of the report were published in a news report by the Business Standard on 31 Jan 19, which happened to be the first day of the budget session of Parliament.
  • The opposition led by the Congress party sought to corner the government on 31 Jan 19 and is now proposing to force a debate on jobs in the ongoing session. Key opposition parties raised the issue in an all-party meet organized by the government.
  • The government on its part, in a briefing chaired by Rajiv Kumar, vice chairman of NITI Aayog, engaged in damage control by claiming that what had been revealed was based on an interim report.
  • The news report said the labour force participation rate too fell to 36.7% in 2017-18 from 39.11% in 2011-12. It added that the unemployment rate among rural men aged 15-29 climbed to 17.4% from 5% during the same period.
  • The report echoed the opposition’s claim that the government has failed to create enough jobs and that the implementation of demonetization in Nov 17 hit the economy as well as employment prospects.
  • The revival of the debate just before the forthcoming general election has put the BJP on the back foot, especially after two non-official members of the National Statistical Commission (NSC) including the acting chairman of the apex statistical body P.C. Mohanan resigned, claiming the Union government was trying to suppress the data.
  • The NSC is an autonomous body constituted in 2006 and tasked to monitor and review the functioning of the country’s statistical systems. Three months ago, the NSC had been snubbed by the Niti Aayog over finalisation of GDP back series data, which showed the current government’s record on growth was better than that of its predecessor, the United Progressive Alliance (UPA).
  • At a press conference in its party headquarters on 31 Jan 19, former Union minister Anand Sharma accused the government of “hiding” the data which showed that “demonetization dealt a blow to the unorganized sector and jobs”.
  • Most opposition parties have now demanded that there should be a detailed debate and discussion in Parliament on the issue of lack of job creation in India. An emboldened opposition plans to link it to demonetization and implementation of the goods and services tax.
  • BJP leaders argue that the methodology to calculate job creation is faulty and does not capture all the sectors. Even as BJP leaders admit that job creation is an important challenge, they point out that the data does not look at job creation in the informal sector.
  • “The periodic labour force survey (PLFS) report of NSSO (National Sample Survey Office) is not yet finalised. It’s a draft report which has not been verified by the government,” Niti Aayog vice chairman Rajiv Kumar said at a press briefing.
  • Kumar said India’s economic growth figures were at odds with large-scale unemployment. Processing of data is still on for the 3Q18 and 4Q18 to determine the actual incremental change in the employment rate, he said.
  • The Niti Aayog is of the view that high growth cannot take place without a rise in employment as there has been a decline in private investment and no significant improvement in productivity.
  • Niti Aayog CEO Amitabh Kant said the suggestion that the government is trying to hide something was incorrect. There is plenty of evidence that jobs are being created but the problem, however, is the lack of quality employment, he said.
  • Citing a report by the McKinsey, Kant said a combination of increased government spending, additional IT hiring, and increase in entrepreneurship created employment for 20-26 million people between 2014 and 2017.

External Link: https://www.livemint.com/politics/news/leaked-nsso-report-revives-jobs-debate-puts-bjp-on-the-back-foot-1548962511318.html

External Link: https://economictimes.indiatimes.com/news/economy/policy/jobs-data-not-finalised-government-after-nsso-report/articleshow/67782769.cms

1-Feb-2019


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