Most Indian states are major economies in their own right and differ widely in their economic performance. This diversity offers an opportunity to compare and contrast experiences in employment generation and creation of decent jobs. State-specific studies and studies comparing different states will be conducted and commissioned by the Centre, offering an opportunity to learn from successful employment experiences.

India is home to the largest youth population in the world. Creating gainful employment for the growing workforce is a priority if the ‘demographic dividend’ is to be reaped. Yet, in recent years, despite sustained economic growth, the Indian economy has failed to generate adequate jobs. The majority of the population continue to be employed in agriculture while contributing to only a quarter of the nation’s GDP. In this context, the creation of jobs that are productive, sustainable and decent is imperative. Financial globalisation and consequently greater access to capital for domestic firms has had implications for job creation in the country. The Centre’s work will examine reasons for the inability of India’s growing economy to create productive and decent jobs while identifying potential sectors and activities that could lead job creation in the future.

Recently there has been a lot of anxiety around the lack of skilled labour in India. While public policy has renewed focus on skill generation and providing vocational training, there exists very little data on the effectiveness of these interventions. On the other hand there is very little official recognition of informal and historically acquired skills as viable means for generating sustainable employment. Research at the Centre builds the case for taking informal skills seriously while at the same time improving the quality of formal skill creation institutions.

An understanding of the labour market in India requires moving beyond statistics so as to consider qualitative dimensions of work as well. These include physical conditions of work environments, the nature of employment arrangements in terms of security and dignity of work.  Post-liberalisation, in response to global demand for flexible and just-in-time production models, alternative work arrangements emerged allowing for workers to be hired and fired easily, with minimum or no social security benefits. Consequently, formal jobs which are accompanied by some security of tenure, and/or social security benefits have contracted. Instead, informal jobs, i.e. precarious jobs without basic social security support, have multiplied, both in the unorganised and organised sector. On the one hand, these jobs allow flexibility for enterprises and workers. On the other hand, it makes work precarious, unregulated and insecure. Acknowledging the importance of considering qualitative aspects of work, the Centre’s work will draw from multiple disciplines including economics, political economy, sociology and development studies.

Agriculture continues to be the predominant sector of employment, accounting for almost half the labour force.  At the same time, it contributes to less than a quarter of GDP indicating low productivity work and disguised unemployment. While the services sector is an important employer, most jobs are informal and vulnerable. Most service sector enterprises are small-scale, own account enterprises with limits to productivity. Manufacturing and construction have emerged as important employers, yet the nature of work is often precarious and in abysmal conditions. Manufacturing is identified in government policy as a major employer – Make in India, yet this sector has seen increase in capital intensity as well as the rise of informal contract-based employment arrangements.  These will be some of the broad themes that sectoral studies at the Centre will focus on.

Legislation regulating the hiring and firing of workers, working conditions, benefits, and other aspects of the capital-labour relationship is at the centre of the debate around “jobless growth.” Multiplicity of laws, overlapping regulatory institutions, and costs of enforcement are often cited as the reason for poor employment creation. On the other hand most of India’s labour force is in informal employment outside the ambit of labour laws. Are labour laws an important constraint for job creation? If so, in which sectors? The work at the Centre will examine the broad implications of labour laws incorporating considerations of political economy and governance, while also focusing on specific cases in selected sectors or regions.