Employment growth in India saw a significant boost in the financial year 2023-24, with a 6 per cent increase in new job creation, according to data released by the Reserve Bank of India (RBI) on Monday. This uptick translates to approximately 4.67 crore new jobs, bringing the total number of employed individuals in the country to 64.33 crore.
The RBI's KLEMS data, which stands for capital (K), labour (L), energy (E), material (M), and services (S), indicates that the job creation rate nearly doubled from the 3.2 per cent recorded in the previous year. KLEMS data, essential for measuring industry-level productivity and employment, showed a notable improvement in the employment landscape.
In an unprecedented move, the RBI also released a "provisional estimate of productivity for the total economy" for the first time. This data is extrapolated from the National Accounts and the Ministry of Labour and Employment.
Simultaneously, the union Ministry of Labour & Employment issued a statement asserting that over 8 crore new employment opportunities were created from fiscal years 2017-18 to 2021-22, averaging over 2 crore jobs per year. This period included the challenging year of 2020-21, when the global economy was severely impacted by the COVID-19 pandemic. The ministry's statement serves as a rebuttal to a recent Citigroup report, which claimed that India would struggle to generate sufficient employment even with a 7 per cent GDP growth rate.
Citigroup's report projected that India would only be able to create 8-9 million (80 to 90 lakh) jobs annually at a 7 per cent growth rate, against the required 11-12 million. The Ministry of Labour & Employment criticised this report, emphasising the reliability of official statistics over private data sources, which they argue can lead to misleading conclusions.
Referring to data from the National Pension System (NPS), the ministry highlighted that more than 7.75 lakh new subscribers joined the NPS in 2023-24 under central and state governments, a 30 per cent increase from the 5.94 lakh new subscribers in 2022-23. This rise underscores the government's proactive efforts to address public sector vacancies.
Furthermore, data from the Periodic Labour Force Survey (PLFS) revealed consistent employment growth over the last five years. The Worker Population Ratio (WPR) increased from 46.8 per cent in 2017-18 to 56 per cent in 2022-23, while the labour force participation rate rose from 49.8 per cent to 57.9 per cent. Notably, the unemployment rate for individuals aged 15 and above declined from 6 per cent to 3.2 per cent.
"This is a clear indicator of the positive impact of government policies on employment. Contrary to the report, which suggests a dire employment scenario, the official data reveals a more optimistic picture of the Indian job market," the ministry stated.
The latest employment data underscores the resilience of the Indian economy and the effectiveness of government initiatives in fostering job creation, despite global economic challenges.
