As Nirmala Sitharaman takes charge of the Finance Ministry, the twin challenges of economic slowdown and job crisis confront her. The latest figures revealed by the government on these fronts are a cause for concern as they show a negative trend. The unemployment rate has alarmingly risen to a 45-year high of 6.1 per cent in 2017-18. While the government says the new criterion of linking education to joblessness instead of the monthly per capita expenditure renders the finding incomparable to the earlier statistics, the argument lacks credibility in the light of the controversy over data leak in January. The National Sample Survey Office had then also pegged joblessness at 6.1 per cent, but it was dismissed by the government at that time, obviously to avoid disconcerting questions over this issue during the elections. The workforce has clearly not yet recovered from the blows of demonetisation and GST that crippled the unorganised micro industry. The urban population has suffered a bigger blow, with 7.8 per cent of the employable urban youth being jobless, while the figure for rural unemployment was 5.3 per cent.
Pulled down by a decline in the performance of both the agriculture and manufacturing sectors, the economic growth has slumped to a five-year low of 5.8 per cent in the fourth quarter of the last fiscal. Adding to the woes is the sluggish expansion of core sector industries during April at a low rate of 2.6 per cent as compared to 4.7 per cent growth in March.
This bleak scenario calls for job creation by encouraging labour-intensive industries. It is essential to make education relevant to the changing requirements of the industry, for, along with unemployment, underemployment is a nagging problem. The government needs to make public investments to bring the informal sector back on track. Shrinking jobs spell disaster for our increasingly educated and young demographic profile as also for the country's fiscal health.