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LATEST NEWS UPDATES | Missing demographic dividend? by Arup Mitra </title>
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The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in..."/>
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The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in..." />
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<h1 class="cat-box-title">Missing demographic dividend? by Arup Mitra</h1>
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Published on</span><span class="text-date"> Jul 4, 2011</span>
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<br /><div align="justify">The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in rural and urban areas as compared to 2004-05. Even among urban males, there is a decline in the rates as per the usual and weekly status, though the daily status work participation rate shows an improvement. Only the rural males reported an increased participation in the labour market in terms of all the three criteria.<br /><br />The decline in the work participation rate of females can stem from their increased participation in education and withdrawal from petty or subsidiary activities. Women may withdraw from principal activities if male earnings improve considerably - female participation in the labour market is still seen as a matter of economic compulsion. But is this the right explanation?<br /><br />It gathers support from the declining daily status unemployment rate, which measures open unemployment and underutilisation of labour to some extent. If women are engaged in petty activities involving underemployment to a considerable extent they may like to withdraw if the male earnings go up or there are possibilities for women to upgrade their skill. The daily status unemployment rate shows a decline among both the males and females and in both the rural and urban areas. Therefore, the availability of quality employment in recent years may be said to have reduced the participation of women in the labour market. For example, instead of both mother and daughter working together, the mother alone might choose to earn. Broad corroboration comes from increased participation among rural males and rise in the urban male daily status work participation rate with a fall in urban male underemployment.<br /><br />However, are these changes consistent with the rise in the relative size of population in the 15-59 economically active age group, which underpins India's demographic dividend? Even if one argues that participation in jobs has been delayed till 21 or so, are these changes governed entirely by the supply-side factors? There is certainly a major decline in demand for labour, which seems to have affected the women most. In the urban areas in low-income jobs, underemployment might have declined, implying a rise in male daily status work participation rate. But the rate of growth in the overall labour demand has dropped both for males and females in urban areas.<br /><br />The lack of rural diversification must be a factor in reducing the pace of rural labour demand. On the other hand, the urban labour market is in a tight situation to provide for the surplus lot. The effect of the financial crisis cannot be ruled out, though there may be signs of improvement in certain quarters. Even some of the moderately skilled workforce has been forced to withdraw from the job market with a plea to pursue higher levels of skills and enhance future earnings. On the whole, the overall slack has motivated many to withdraw from the labour market, resulting in reduced work participation rate and unemployment rate both. Applying the participation rates to the provisional population total reported from the population census 2011, our tentative estimate of workforce growth turns out to be less than half a per cent per annum between the 61st and 66th rounds. Hardly an indicator of any robust demographic dividend.<br /><br />On the other hand, given the rate of inflation, real earnings are not likely to have increased so much so that a large number could enjoy the luxury of staying outside the labour market. The phenomenon of discouraged dropouts implying women to withdraw from the labour market due to unavailability of suitable jobs for a long time, cannot be ruled out. And finally one may have reasons to suspect if the investigators could actually capture and implement the concepts and criteria while carrying out the fieldwork.<br /><br />The nature of employment indicates that among the workers in the rural areas, around 54.2% are engaged in self-employment, 38.6% as casual workers and only 7.3% in regular wage employment. In the urban areas, the share of self-employment turns out to be 41.1% and that that of casual employment 17.5%. Between the two survey years, the share of self-employment is on the decline, which is accompanied by a rise in casualisation both in the rural and urban areas and besides, there is a rise in the relative size of workforce engaged in regular wage employment in the urban areas. Possibly this increase in regular wage employment in the urban areas has taken place for the highly skilled workers, whereas the unskilled and semi-skilled variety witnessed a shift away from self-employment towards casual employment. Unless the terms and conditions of employment improve for the casual workers, it would be difficult to suggest that this change is beneficial.<br /><br /><em>(The author is Professor of Economics, Institute of Economic Growth) </em><br /></div>
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<br><a href="http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms" class="re" target="_blank">The Economic Times, 4 July, 2011, http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms</a><div class="clear"></div>
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<h1 class="cat-box-title">Missing demographic dividend? by Arup Mitra</h1>
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Published on</span><span class="text-date"> Jul 4, 2011</span>
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<br /><div align="justify">The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in rural and urban areas as compared to 2004-05. Even among urban males, there is a decline in the rates as per the usual and weekly status, though the daily status work participation rate shows an improvement. Only the rural males reported an increased participation in the labour market in terms of all the three criteria.<br /><br />The decline in the work participation rate of females can stem from their increased participation in education and withdrawal from petty or subsidiary activities. Women may withdraw from principal activities if male earnings improve considerably - female participation in the labour market is still seen as a matter of economic compulsion. But is this the right explanation?<br /><br />It gathers support from the declining daily status unemployment rate, which measures open unemployment and underutilisation of labour to some extent. If women are engaged in petty activities involving underemployment to a considerable extent they may like to withdraw if the male earnings go up or there are possibilities for women to upgrade their skill. The daily status unemployment rate shows a decline among both the males and females and in both the rural and urban areas. Therefore, the availability of quality employment in recent years may be said to have reduced the participation of women in the labour market. For example, instead of both mother and daughter working together, the mother alone might choose to earn. Broad corroboration comes from increased participation among rural males and rise in the urban male daily status work participation rate with a fall in urban male underemployment.<br /><br />However, are these changes consistent with the rise in the relative size of population in the 15-59 economically active age group, which underpins India's demographic dividend? Even if one argues that participation in jobs has been delayed till 21 or so, are these changes governed entirely by the supply-side factors? There is certainly a major decline in demand for labour, which seems to have affected the women most. In the urban areas in low-income jobs, underemployment might have declined, implying a rise in male daily status work participation rate. But the rate of growth in the overall labour demand has dropped both for males and females in urban areas.<br /><br />The lack of rural diversification must be a factor in reducing the pace of rural labour demand. On the other hand, the urban labour market is in a tight situation to provide for the surplus lot. The effect of the financial crisis cannot be ruled out, though there may be signs of improvement in certain quarters. Even some of the moderately skilled workforce has been forced to withdraw from the job market with a plea to pursue higher levels of skills and enhance future earnings. On the whole, the overall slack has motivated many to withdraw from the labour market, resulting in reduced work participation rate and unemployment rate both. Applying the participation rates to the provisional population total reported from the population census 2011, our tentative estimate of workforce growth turns out to be less than half a per cent per annum between the 61st and 66th rounds. Hardly an indicator of any robust demographic dividend.<br /><br />On the other hand, given the rate of inflation, real earnings are not likely to have increased so much so that a large number could enjoy the luxury of staying outside the labour market. The phenomenon of discouraged dropouts implying women to withdraw from the labour market due to unavailability of suitable jobs for a long time, cannot be ruled out. And finally one may have reasons to suspect if the investigators could actually capture and implement the concepts and criteria while carrying out the fieldwork.<br /><br />The nature of employment indicates that among the workers in the rural areas, around 54.2% are engaged in self-employment, 38.6% as casual workers and only 7.3% in regular wage employment. In the urban areas, the share of self-employment turns out to be 41.1% and that that of casual employment 17.5%. Between the two survey years, the share of self-employment is on the decline, which is accompanied by a rise in casualisation both in the rural and urban areas and besides, there is a rise in the relative size of workforce engaged in regular wage employment in the urban areas. Possibly this increase in regular wage employment in the urban areas has taken place for the highly skilled workers, whereas the unskilled and semi-skilled variety witnessed a shift away from self-employment towards casual employment. Unless the terms and conditions of employment improve for the casual workers, it would be difficult to suggest that this change is beneficial.<br /><br /><em>(The author is Professor of Economics, Institute of Economic Growth) </em><br /></div>
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<br><a href="http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms" class="re" target="_blank">The Economic Times, 4 July, 2011, http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms</a><div class="clear"></div>
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<h1 class="cat-box-title">Missing demographic dividend? by Arup Mitra</h1>
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Published on</span><span class="text-date"> Jul 4, 2011</span>
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<br /><div align="justify">The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in rural and urban areas as compared to 2004-05. Even among urban males, there is a decline in the rates as per the usual and weekly status, though the daily status work participation rate shows an improvement. Only the rural males reported an increased participation in the labour market in terms of all the three criteria.<br /><br />The decline in the work participation rate of females can stem from their increased participation in education and withdrawal from petty or subsidiary activities. Women may withdraw from principal activities if male earnings improve considerably - female participation in the labour market is still seen as a matter of economic compulsion. But is this the right explanation?<br /><br />It gathers support from the declining daily status unemployment rate, which measures open unemployment and underutilisation of labour to some extent. If women are engaged in petty activities involving underemployment to a considerable extent they may like to withdraw if the male earnings go up or there are possibilities for women to upgrade their skill. The daily status unemployment rate shows a decline among both the males and females and in both the rural and urban areas. Therefore, the availability of quality employment in recent years may be said to have reduced the participation of women in the labour market. For example, instead of both mother and daughter working together, the mother alone might choose to earn. Broad corroboration comes from increased participation among rural males and rise in the urban male daily status work participation rate with a fall in urban male underemployment.<br /><br />However, are these changes consistent with the rise in the relative size of population in the 15-59 economically active age group, which underpins India's demographic dividend? Even if one argues that participation in jobs has been delayed till 21 or so, are these changes governed entirely by the supply-side factors? There is certainly a major decline in demand for labour, which seems to have affected the women most. In the urban areas in low-income jobs, underemployment might have declined, implying a rise in male daily status work participation rate. But the rate of growth in the overall labour demand has dropped both for males and females in urban areas.<br /><br />The lack of rural diversification must be a factor in reducing the pace of rural labour demand. On the other hand, the urban labour market is in a tight situation to provide for the surplus lot. The effect of the financial crisis cannot be ruled out, though there may be signs of improvement in certain quarters. Even some of the moderately skilled workforce has been forced to withdraw from the job market with a plea to pursue higher levels of skills and enhance future earnings. On the whole, the overall slack has motivated many to withdraw from the labour market, resulting in reduced work participation rate and unemployment rate both. Applying the participation rates to the provisional population total reported from the population census 2011, our tentative estimate of workforce growth turns out to be less than half a per cent per annum between the 61st and 66th rounds. Hardly an indicator of any robust demographic dividend.<br /><br />On the other hand, given the rate of inflation, real earnings are not likely to have increased so much so that a large number could enjoy the luxury of staying outside the labour market. The phenomenon of discouraged dropouts implying women to withdraw from the labour market due to unavailability of suitable jobs for a long time, cannot be ruled out. And finally one may have reasons to suspect if the investigators could actually capture and implement the concepts and criteria while carrying out the fieldwork.<br /><br />The nature of employment indicates that among the workers in the rural areas, around 54.2% are engaged in self-employment, 38.6% as casual workers and only 7.3% in regular wage employment. In the urban areas, the share of self-employment turns out to be 41.1% and that that of casual employment 17.5%. Between the two survey years, the share of self-employment is on the decline, which is accompanied by a rise in casualisation both in the rural and urban areas and besides, there is a rise in the relative size of workforce engaged in regular wage employment in the urban areas. Possibly this increase in regular wage employment in the urban areas has taken place for the highly skilled workers, whereas the unskilled and semi-skilled variety witnessed a shift away from self-employment towards casual employment. Unless the terms and conditions of employment improve for the casual workers, it would be difficult to suggest that this change is beneficial.<br /><br /><em>(The author is Professor of Economics, Institute of Economic Growth) </em><br /></div>
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<br><a href="http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms" class="re" target="_blank">The Economic Times, 4 July, 2011, http://economictimes.indiatimes.com/opinion/guest-writer/missing-demographic-dividend/articleshow/9094916.cms</a><div class="clear"></div>
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LATEST NEWS UPDATES | Missing demographic dividend? by Arup Mitra
The results of the NSS 66th round survey (2009-10) on employment and unemployment show a striking decline in the female labour force and the workforce participation rates as per all the three criteria (the usual, weekly and daily status) in rural and urban areas as compared to 2004-05. Even among urban males, there is a decline in the rates as per the usual and weekly status, though the daily status work participation rate shows an improvement. Only the rural males reported an increased participation in the labour market in terms of all the three criteria.
The decline in the work participation rate of females can stem from their increased participation in education and withdrawal from petty or subsidiary activities. Women may withdraw from principal activities if male earnings improve considerably - female participation in the labour market is still seen as a matter of economic compulsion. But is this the right explanation?
It gathers support from the declining daily status unemployment rate, which measures open unemployment and underutilisation of labour to some extent. If women are engaged in petty activities involving underemployment to a considerable extent they may like to withdraw if the male earnings go up or there are possibilities for women to upgrade their skill. The daily status unemployment rate shows a decline among both the males and females and in both the rural and urban areas. Therefore, the availability of quality employment in recent years may be said to have reduced the participation of women in the labour market. For example, instead of both mother and daughter working together, the mother alone might choose to earn. Broad corroboration comes from increased participation among rural males and rise in the urban male daily status work participation rate with a fall in urban male underemployment.
However, are these changes consistent with the rise in the relative size of population in the 15-59 economically active age group, which underpins India's demographic dividend? Even if one argues that participation in jobs has been delayed till 21 or so, are these changes governed entirely by the supply-side factors? There is certainly a major decline in demand for labour, which seems to have affected the women most. In the urban areas in low-income jobs, underemployment might have declined, implying a rise in male daily status work participation rate. But the rate of growth in the overall labour demand has dropped both for males and females in urban areas.
The lack of rural diversification must be a factor in reducing the pace of rural labour demand. On the other hand, the urban labour market is in a tight situation to provide for the surplus lot. The effect of the financial crisis cannot be ruled out, though there may be signs of improvement in certain quarters. Even some of the moderately skilled workforce has been forced to withdraw from the job market with a plea to pursue higher levels of skills and enhance future earnings. On the whole, the overall slack has motivated many to withdraw from the labour market, resulting in reduced work participation rate and unemployment rate both. Applying the participation rates to the provisional population total reported from the population census 2011, our tentative estimate of workforce growth turns out to be less than half a per cent per annum between the 61st and 66th rounds. Hardly an indicator of any robust demographic dividend.
On the other hand, given the rate of inflation, real earnings are not likely to have increased so much so that a large number could enjoy the luxury of staying outside the labour market. The phenomenon of discouraged dropouts implying women to withdraw from the labour market due to unavailability of suitable jobs for a long time, cannot be ruled out. And finally one may have reasons to suspect if the investigators could actually capture and implement the concepts and criteria while carrying out the fieldwork.
The nature of employment indicates that among the workers in the rural areas, around 54.2% are engaged in self-employment, 38.6% as casual workers and only 7.3% in regular wage employment. In the urban areas, the share of self-employment turns out to be 41.1% and that that of casual employment 17.5%. Between the two survey years, the share of self-employment is on the decline, which is accompanied by a rise in casualisation both in the rural and urban areas and besides, there is a rise in the relative size of workforce engaged in regular wage employment in the urban areas. Possibly this increase in regular wage employment in the urban areas has taken place for the highly skilled workers, whereas the unskilled and semi-skilled variety witnessed a shift away from self-employment towards casual employment. Unless the terms and conditions of employment improve for the casual workers, it would be difficult to suggest that this change is beneficial.
(The author is Professor of Economics, Institute of Economic Growth)
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