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India's Youth Unemployment: 2024 ILO Report



  Apr 01, 2024

India's Youth Unemployment: 2024 ILO Report



Introduction:

The India Employment Report 2024, crafted by the Institute for Human Development (IHD) in collaboration with the International Labour Organization (ILO), provides an in-depth examination of the current state and evolving dynamics of the Indian labor market, with a special focus on youth employment, education, and skill development. This report covers trends over the last two decades, paying particular attention to the impact of the COVID-19 pandemic on employment patterns.

Demographic Trends and Employment Challenges:

The report identifies a critical demographic trend: the growing proportion of the working-age population, which has seen an increase from 61% in 2011 to 64% in 2021, with a projection to reach 65% by 2036. This demographic shift has resulted in the addition of 7-8 million young individuals to the labor force annually. Despite an increase in educational attainment among the youth, their participation in economic activities has notably declined from 52% in 2000 to 37% in 2022.

Youth Unemployment: A Predominant Issue:

Unemployment is highlighted as a significant issue predominantly affecting the youth, particularly those with secondary education or higher. The report underscores a worrying trend: an increase in the share of unemployed youth in the total unemployed population, reaching 82.9% in 2022. Furthermore, the share of educated youth among the unemployed has risen from 54.2% in 2000 to 65.7% in 2022. The gender disparity is stark, with educated unemployed women making up a larger share than their male counterparts.

The Crisis of Job Opportunities and Skills Mismatch:

The underlying issues contributing to youth unemployment are twofold: the lack of job opportunities and the unemployability of educated youth, attributed to the poor quality of education and inadequate vocational training. The report reveals that only a small fraction of Indian youth have received formal vocational training, which is essential for bridging the gap between education and employment demands. Additionally, the increase in employment within the agricultural sector post-2019 is seen as indicative of the challenges faced by youth in securing jobs in other sectors, largely due to educational shortcomings.

Employment Quality and Informality:

A significant concern raised by the report is the predominance of informal employment, even within the formal sector. The majority of jobs in 2023 were found to be informal in nature, and a substantial portion of formal sector jobs also exhibited informal characteristics. This situation has led to widespread job insecurity and low-wage employment, with a considerable number of workers earning below the government-prescribed minimum wage.

Gender Disparities in Labor Force Participation:

The gender gap in labor force participation remains a critical issue, with young women’s participation rates significantly lower than those of young men. The report attributes this disparity to various factors, including societal norms and the lack of supportive policies for women’s employment. The decrease in women’s participation in the workforce has contributed to rising unemployment rates, although there has been a slight improvement post-2019.

Strategic Recommendations for Addressing Youth Unemployment:

The report puts forth a series of strategic recommendations aimed at tackling the challenges of youth unemployment and enhancing employment quality. These include:

• Fostering employment-intensive growth to improve the quality of jobs available.
• Addressing labor market inequalities and ensuring equitable access to employment opportunities.
• Enhancing the effectiveness of skills training and active labor market policies.
• Bridging knowledge gaps regarding labor market trends and youth employment.
• Supporting micro, small, and medium-sized enterprises to spur job creation.
• Promoting policies to increase women’s labor force participation and ensure a minimum quality of employment across all sectors.

Conclusion:

The India Employment Report 2024 serves as a crucial resource for understanding the complex issues surrounding youth unemployment in India. By implementing the recommended strategies, there is potential to significantly improve employment outcomes for the youth, promote gender equality in the workforce, and build a more inclusive and resilient economy.


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