Que. “Economic growth in the recent past has been led by increase in labour productivity.” Explain this statement. Suggest the growth pattern that will lead to creation of more jobs without compromising labour productivity.
“हाल के दिनों का आर्थिक विकास श्रम उत्पादकता में वृद्धि के कारण संभव हुआ है।” इस कथन को समझाइए। ऐसे संवृद्धि प्रतिरूप को प्रस्तावित कीजिए जो श्रम उत्पादकता से समझौता किए बिना अधिक रोजगार उत्पत्ति में सहायक हो।
Structure of the Answer
(i) Introduction: Provide a concise explanation of “labour productivity” and its role in recent “economic growth” while setting the context for job-oriented growth strategies.
(ii) Main Body: Discuss recent productivity-driven growth, its effects on job creation, and propose a balanced growth model for enhanced job creation without reducing productivity.
(iii) Conclusion: Summarize the need for a growth pattern that combines “labour productivity” with broad job opportunities for sustainable and inclusive economic development.
Introduction
India’s recent economic growth has been predominantly driven by “labour productivity,” emphasizing efficiency over job expansion. Balancing productivity with robust job creation is essential for inclusive and sustainable growth.
Growth Driven by Increased Labour Productivity
(i) Role of Technology in Productivity Gains: Automation and “digital innovation” in sectors like manufacturing have led to higher productivity but limited new employment in low-skilled areas.
(ii) Sectoral Focus on Capital-Intensive Industries: Productivity-led growth has been concentrated in “capital-intensive” sectors, benefiting skilled workers but limiting unskilled job creation.
(iii) Agriculture and Low-Skill Jobs: Mechanization in agriculture and low-skill manufacturing has raised productivity yet reduced labour demand, affecting rural job opportunities.
(iv) Upskilling in High-Productivity Sectors: Investments in “high-skilled” sectors enhance productivity, yet create jobs primarily for a skilled minority, leaving unskilled workers behind.
(v) Widening Wage Disparities: High productivity has led to better wages for skilled jobs, exacerbating “income inequality” as low-skilled jobs remain stagnant or shrink.
Suggested Growth Patterns for Job Creation and Labour Productivity
(i) Emphasis on Labour-Intensive Industries: Expanding industries like textiles and food processing creates more jobs; training can improve efficiency without sacrificing employment.
(ii) Upskilling for Emerging Sector Demand: Workforce training for digital services, renewable energy, and electronics ensures skill-aligned productivity growth and job creation.
(iii) Strengthening MSMEs for Inclusive Job Growth: MSMEs play a key role in job creation; supporting MSMEs with “financial aid” and tech integration enhances both productivity and job growth.
(iv) Digital and Gig Economy Regulation: Supporting flexible job opportunities in the “gig economy” ensures income security while enhancing productivity through diversified work models.
(v) Green and Sustainable Sector Expansion: Growth in sustainable industries like eco-tourism and clean energy fosters job creation with an eye toward long-term productivity.
Policy Recommendations for Sustained Productivity and Job Growth
(i) Sectoral Employment Quotas: Encouraging “labour-intensive quotas” in capital-intensive sectors could balance productivity and job creation, particularly in high-employment sectors.
(ii) Public Investment in Training Programs: Targeted training programs for under-represented workers in emerging sectors can prepare the workforce for high-growth, high-productivity roles.
(iii) Rural and Urban Skill Development: Enhancing access to “vocational training” in both rural and urban regions would prepare individuals for productive roles in evolving industries.
(iv) MSME Digitalization Initiatives: Digitalizing MSMEs could make smaller firms more productive while sustaining labour demand, supporting broader economic goals.
(v) Tax Incentives for Job-Heavy Sectors: Tax breaks for job-creating, labour-intensive sectors could incentivize private investment in employment-heavy industries.
Conclusion
Sustaining high “labour productivity” with inclusive job growth is essential for India’s economic stability, with balanced policies ensuring robust employment opportunities across diverse sectors.
