India’s youth, often hailed as the nation’s greatest asset, are paradoxically becoming a pressing concern due to rising unemployability among the educated segment. The latest International Labour Organization (ILO) report provides a comprehensive overview of the unemployment crisis that plagues India’s educated youth. Despite significant strides in educational attainment, many young Indians find themselves without jobs, trapped in informal employment, or underemployed. This issue is further compounded by the rapid technological advancements that are reshaping the job market, creating a stark disconnect between the skills possessed by job seekers and those demanded by employers.
The report reveals that youth unemployment in India surged from 5.7% in 2000 to 17.5% in 2019, before a slight improvement to 12.4% in 2022 (SRIRAMs IAS) (MoneyControl). This improvement, however, masks deeper issues such as the persistent high unemployment rates among graduates, particularly women, who face significantly higher rates of joblessness and disengagement from the labor market compared to their male counterparts (SRIRAMs IAS) (mint). The findings suggest that the problem is not merely a lack of jobs but a mismatch between the available jobs and the skills of the educated youth.
Further complicating the scenario is the quality of employment. The majority of jobs available to young people are informal, lacking job security, regular wages, and social protection. This reality underscores the widespread job insecurity and low-wage employment that dominate the youth labor market (MoneyControl) (mint). The ILO report emphasizes that nearly 90% of the workforce is engaged in informal employment, highlighting the urgent need for policy interventions to improve job quality and security.
A significant barrier to employment is the skills mismatch. Despite the increasing educational qualifications, many youths lack the necessary skills to meet market demands. The report highlights that a considerable portion of Indian youth struggle with basic digital literacy, a crucial skill in today’s job market. For instance, many cannot perform simple tasks such as sending emails with attachments or using basic spreadsheet functions (Chronicle India) (mint). This skills gap points to a critical need for aligning educational curricula with the evolving needs of the labor market.
Technological advancements, especially in artificial intelligence (AI), are further altering the employment landscape. While these advancements create new job opportunities, they also pose a threat to traditional jobs, especially in sectors susceptible to automation (Chronicle India). This shift necessitates a focus on continuous skill development to ensure that the youth can adapt to new job roles in the digital economy.
Gender disparities in employment are another significant concern. Young women face higher unemployment rates and lower labor force participation compared to men, exacerbated by societal norms and a lack of supportive policies (SRIRAMs IAS) (mint). This disparity calls for targeted interventions to promote gender equality in the workforce.
The ILO report’s findings and recommendations highlight the multifaceted nature of youth unemployment in India. Addressing these challenges requires a comprehensive approach that includes promoting job creation, improving job quality, addressing labor market inequalities, strengthening skills development, and supporting micro, small, and medium-sized enterprises (MSMEs). By implementing these strategic measures, India can turn its demographic advantage into a significant economic asset, fostering sustainable and inclusive growth.
Key Findings
1. Rising Youth Unemployment Rates
The ILO report highlights a worrying trend: youth unemployment in India has more than tripled over the past two decades. From 5.7% in 2000, it peaked at 17.5% in 2019 before slightly improving to 12.4% in 2022. But this improvement is nuanced, as educated youths, especially those with graduate degrees, face the highest levels of unemployment. This issue is more pronounced among women, who are five times more likely than men to be neither in employment, education, nor training (NEET) (SRIRAMs IAS) (MoneyControl) (mint).
2. Poor Quality of Employment
Despite some improvements in labor market participation rates post-2019, the quality of available jobs remains a concern. The majority of young workers are engaged in informal employment, characterized by job insecurity, irregular wages, and lack of social protection. The report states that nearly 90% of the workforce is in informal employment, with many jobs offering low wages and limited benefits (MoneyControl) (mint).
3. Skills Mismatch
A significant factor contributing to youth unemployment is the mismatch between the skills acquired through education and those demanded by employers. The report highlights a dire need for vocational training, as many youths lack essential digital skills. For instance, 75% of young people struggle with basic tasks like sending emails with attachments, and 90% cannot handle mathematical formulas in spreadsheets (Chronicle India) (mint).
4. Impact of Technological Advancements
Technological advancements, particularly in artificial intelligence (AI), are reshaping the job market. While these advancements create new opportunities, they also pose a threat to traditional jobs, especially in the back-office sectors. The report emphasizes the need for continuous skills development to ensure that youth can adapt to the evolving job market (Chronicle India).
5. Gender Disparities
Gender disparities in employment are stark, with young women facing higher unemployment rates and lower labor force participation compared to men. Societal norms and a lack of supportive policies exacerbate these disparities. The report calls for targeted interventions to promote gender equality in the workforce (SRIRAMs IAS) (mint).
Strategic Recommendations
To address these multifaceted challenges, the ILO report suggests several strategic measures:
Promoting Job Creation
Economic policies should focus on fostering employment-intensive growth, particularly in non-farm sectors like manufacturing and services. This approach can absorb the increasing number of youths entering the labor market each year (Chronicle India) (MoneyControl).
Enhancing Employment Quality
Improving the quality of jobs available is crucial. This involves ensuring job security, regular wages, and benefits that meet minimum standards. The shift towards contractual employment and the rise in informal jobs need to be addressed to improve job quality (MoneyControl) (mint).
Addressing Labor Market Inequalities
Equitable access to employment opportunities is essential. Policies should focus on marginalized groups, including women and scheduled castes and tribes, to ensure they have fair access to quality jobs (Chronicle India) (MoneyControl).
Strengthening Skills Development
Aligning educational curricula with market demands and enhancing vocational training are critical. Continuous skills development will help bridge the gap between education and employment, making youths more employable (Chronicle India) (mint).
Supporting MSMEs
Micro, small, and medium-sized enterprises (MSMEs) play a crucial role in job creation. Providing these enterprises with the necessary tools, such as digitalization and AI, and adopting a cluster-based approach to manufacturing can enhance their productivity and employment potential (Chronicle India) (MoneyControl).
The ILO report underscores the urgency of addressing youth unemployment in India. By implementing strategic measures focused on job creation, improving job quality, addressing inequalities, and strengthening skills development, India can harness its demographic dividend. These efforts are essential to build a more inclusive and resilient economy that offers better employment prospects for its educated youth.
India stands at a pivotal point where effective policy implementation and strategic focus can turn its youthful population into a significant economic asset, paving the way for sustainable and inclusive growth.
Mujeeb Patla™ 