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Youth unemployment (ages 15 to 29) is higher than the national average of 12.4 per cent in Telangana (14.2 per cent) and Rajasthan (13 per cent), followed by Chhattisgarh (6.7 per cent) and MP (6 per cent).
Even as elections for the four major state assemblies draw nearer, job creation is poised to emerge as a pivotal electoral issue in the states of Madhya Pradesh, Telangana, Rajasthan and Chhattisgarh.
Earlier this year, the government led by Ashok Gehlot in Rajasthan rekindled the employment debate by passing The Rajasthan Minimum Guaranteed Income Bill, 2023, which seeks to establish legislative support for urban employment guarantee schemes, akin to the national rural employment guarantee scheme implemented in rural areas.
In Telangana, the government initiated a programme in June offering Rs 1 lakh (Rs 100,000) in financial assistance to those engaged in traditional occupations to stimulate fresh employment opportunities among the youth.
Meanwhile, last month, the Chhattisgarh government, under the leadership of Bhupesh Baghel, quashed the provision that required government staff appointed through direct recruitment to wait until their fourth year of appointment to receive full salaries.
Among the four states, Rajasthan has the highest unemployment rate in 2021-2022 at 4.7 per cent, followed by Telangana (4.2 per cent), Chhattisgarh (2.5 per cent), and MP (2.1 per cent), according to a Business Standard analysis of the annual periodic labour force survey (PLFS).
The national average for the same year stood at 4.1 per cent.
Similarly, youth unemployment (ages 15 to 29) is higher than the national average of 12.4 per cent in Telangana (14.2 per cent) and Rajasthan (13 per cent), followed by Chhattisgarh (6.7 per cent) and MP (6 per cent).
K R Shyam Sundar, a visiting professor at the Impact and Policy Research Institute, points out that while both Chhattisgarh and MP have low unemployment rates, this is largely due to the predominance of agriculture in these states.
"Agriculture, with its disguised form of unemployment, absorbs a large portion of the workforce in these two states. What is more important is that we should start examining the quality of employment in these states, specifically, the types of work people are engaging in," he added.
The labour force participation rate, which measures the labour force's supply, surpasses the national average of 41.3 per cent in these four states.
Nearly half of the working-age population (ages 15 to 64) in Chhattisgarh (49.8 per cent) is actively seeking employment, followed by Telangana (47.3 per cent), MP (46 per cent), and Rajasthan (42.6 per cent).
"To provide employment for such a large population, it is necessary to transition from self-employment or casual employment to regular employment," says Sundar.
"In these states, the share of self-employment, which typically includes unpaid household work or ownership of small businesses, has increased at the expense of regular employment over the past few years," Sundar points out.
"Regular employment only increases when a skilled labour force is available to attract investors and invest in manufacturing. Creating skilled labour has challenged these states," Sundar adds.
In 2021-2022, less than one in five workers in Chhattisgarh (16.2 per cent), MP (16.2 per cent), and Rajasthan (17.1 per cent) had regular wage employment, which is generally considered a better form of work by experts.
While wage employment is higher in Telangana (20.8 per cent), the national average stands higher at 21.5 per cent.
Among male workers, 24.9 per cent in Telangana had regular jobs, followed by Rajasthan (22.4 per cent), Chhattisgarh (19.6 per cent), and MP (16.1 per cent). The national average stood at 23.6 per cent.
Among female workers, only 13.7 per cent had regular jobs in Telangana, followed by Chhattisgarh (11.1 per cent), MP (7.7 per cent), and Rajasthan (7.6 per cent).
Santosh Mehrotra, a visiting professor at the University of Bath, points out that labour markets in these interior states began showing signs of stagnation well before the pandemic, leading to an increase in the number of self-employed individuals in agriculture.
This situation was only exacerbated by the pandemic.
Data from PLFS reveals that, except for Chhattisgarh, the other three states witnessed a decline in the share of regular employment and an increase in self-employment from 2018-2019 to 2021-2022.
"The reverse migration during the pandemic saw the addition of nearly 50 million people to agriculture and significant job losses, resulting in a decrease in the number of regular-wage workers," says Mehrotra.
"Post-pandemic, even though the share of regular-wage workers partially recovered at the national level, states like Telangana and MP, which are the origin of many migrants, have neither been able to generate sufficient employment opportunities within their states nor has there been enough demand in the national economy to draw them back," Mehortra explains.
"This explains the increased prevalence of self-employment in these states, which ultimately highlights the low level of job creation."
Feature Presentation: Aslam Hunani/Rediff.com
