Essay: The theory of jobless growth busted
The opposition parties in Bharat with the backing from a handful of economists are ranting about the theory of jobless growth. This idea of jobless growth was first mooted by renowned economist and political analyst Shri Gurumurthy. Every theory has a reference, be it time or place or context. The theory of jobless growth was applicable to the UPA era (2004-2014) and evidences suggest the same. There is no place & time context nor evidence to support this theory for the NDA government of 2014-2019. This proposition that I am making is not singular and Prejudiced; but I will prove that this is a theory that is completely irrelevant to the current period of NDA Government.
Let me simplify the two terms before going into the details. Firstly, Growth means economic growth i.e. in terms of wealth creation. Second, jobs refer to generation of employment in the nation.
As per modern economics, there are two sectors in any economy. One is called the organised sector where Enterprises are fully regulated by government. The other one is the unorganized sector where small and medium scale Enterprises have their own clusters and business hubs not regulated or less regulated by the Government. Some of the examples for the organised sector are the multinational companies, registered firms, individual Enterprises registered under local authority, society’s etcetera. The local Kirana shop, Panipuriwala, the barber, small farmers, cottage industries, a few small scale industries, Dhaba and Darshini hotels, local pawnbrokers, handicraft Enterprises, women self-help groups, Panwala, local transport businesses viz. boats running in Ganga river, village bus services etcetera, Dhobiwala, Dabbawala, Pujari and even chowkidars and many more are all part of the unorganised sector. In Bharat, unorganised sector forms the major chunk of the economy. The wealth generated in the unorganised sector is much more than the organised sector.
According to NCEUS report estimates, in 2005 out of the 458 million persons employed in India, about 86 percent or 395 million worked in the unorganised sector, generating 50.6 percent of the country’s Gross Domestic Product (GDP). These are surveyed figures. Countless Kirana shops, Thelas, itinerants etc go uncounted and do not form part of GDP computation.
The 2004-2010 economics of UPA focused on the formal organised sector. That is the way in which the economy was viewed by the then UPA Government. Even today they are seeing the economy in the same lense. No doubt, the white collared jobs in organised sector too have increased. But, since 2015 the opportunities of self-employment and enterprise have grown big like never before. Let us now look in detail as to how some of the schemes of Modi Sarkar have benefited the people of this Nation including youth in becoming “Job Creators” rather than “Job Seekers”.
Udyog Aadhar Data
In July 2018 Question Hour in the Parliament, the Honourable Minister for Micro, Small and Medium Enterprises (MSME) in reply to a question posed regarding MSME tabled in Parliament reported that 48,39,549 MSMEs have been registered under the Udyog Aadhar Scheme. As on today (21.03.2019) the figure is around 64,20,489 (as per Udyog Aadhar website). This statistics is for the period starting from September 2015 to March 2019. In MSMEs if we assume that at least 2 people are employed in each of this registered enterprise then 1,28,40,978 people are employed from the MSME sector apart from those 64,20,480 who are entrepreneurs themselves (self-employed).
While presenting the Interim Budget 2019-20 in Parliament, the then Union Minister for Finance, Shri Piyush Goyal said that through Pradhan Mantri Kaushal Vikas Yojana, over 1 crore youth are being trained to help them earn a livelihood.
The Mudra scheme started under the Modi Sarkar gives loans to every small entrepreneur and people from weaker sections of the society and especially women have benefited the most from this scheme. As on 1st February, 2019 under MUDRA Yojana, 15.56 crore loans have been disbursed amounting to Rs. 7,23,000 crore. So, effectively at least 15.56 crore people have been benefited by this scheme.
Start Up India
As per the Start Up India data around 3,09,770 new companies and firms have be registered under the Startup India Scheme. Even if a nominal number of 10 people employed in a start up company is considered, a total of 30,97,700 employment has been generated.
Stand Up India Scheme
Government of India launched the Stand Up India scheme on 5th April, 2016. The Scheme facilitates bank loans between Rs.10 lakh and Rs.1 crore to at least one Scheduled Caste/ Scheduled Tribe borrower and at least one Woman borrower per bank branch for setting up Greenfield enterprises. This enterprise may be in manufacturing, services or the trading sector. The scheme which is being implemented through all Scheduled Commercial Banks is to benefit at least 2.5 lakh borrowers. Another 15 lakh – 25 lakh employment may have been roughly generated here.
Apart from the above schemes, programs like “Make in India” has generated lakhs of employment, especially when cell phone manufacturing companies have set up many of its manufacturing units in Uttar Pradesh and around the National Capital Region.
My rough estimate based on above data says around 20 crore employment has been generated under the Modi Government in the last 5 years i.e. 4 crore jobs per annum.
Therefore, the theory of jobless growth is complete bogus, baseless and biased. Self-proclaimed economists & experts in the opposition parties must keep their lips stitched or tender apology for lying in public.
1. Udyog Aadhar Scheme https://udyogaadhaar.gov.in/UA/UAM_Registration.aspx
2. Full report of NCEUS (National Commission for Enterprises in the Un-organised Sector)- “http://pib.nic.in/newsite/PrintRelease.aspx?relid=187913”
3. Press Release by Public Information Bureau on “Mudra Yojana” & skilling of youth- “http://pib.nic.in/newsite/PrintRelease.aspx?relid=187913”