Employment and Skill Development-

Strategies for Enhancing Employability and Generation of Employment

2

Current Employment Scenario
11
th
Plan targeted creation of 58 million job opportunities - 18 million
work opportunities created on CDS basis between 2004-05 & 2009-
10.

Unemployment rate declined from 8.28% in 2004-05 to 6.6% in 2009-
10 on CDS basis & from 2.3% to 2% on UPSS basis.

LFPR declined from 43% to 40% & WFPR from 42% to 39.2%
between 2004-05 and 2009-10.

Increase in Salaries and Wages of regular & casual workers between
2004-05 and 2009-10.

Share of informal sector employment increased marginally from
92.4% (2004-05) to 92.8% (2009-10).

Sectoral share: Decline in agriculture & manufacturing, increase in
non-manufacturing which includes construction, marginal increase in
services.
Labour Force
Participation Rate
Work Force
Participation Rate
Unemployment
Rate
Years
2004-05 2009-10 1999-00 2004-05 2009-10 2004-05 2009-10
Rural
44.6 41.4 41.7 43.9 40.8 1.7 1.6
Urban
38.2 36.2 33.7 36.5 35.0 4.5 3.4
All
43.0 40.0 39.7 42.0 39.2 2.3 2.0
Employment Indicators by UPSS basis (%) Persons
Source: NSS 61
st
and 66
th
Rounds

UNEMPLOYMENT RATE UPSS Basis (%) Persons
1.5
1.7
1.6
4.7
4.5
3.4
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
1999-00 2004-05 2009-10
(
%
)

P
e
r
s
o
n
s

Rural
Urban
Source: NSS 55
th
,61
st
and 66
th
Rounds

EMPLOYMENT INDICATORS
0
20
40
60
1999-00 2004-05 2009-10

%

P
e
r
s
o
n
s

Years
LFPR (%) Persons
Rural
Urban
0
20
40
60
1999-00 2004-05 2009-10
(
%
)

P
e
r
s
o
n
s

Years
WFPR (%) Persons
Rural
Urban
Labour Force Participation Rate Work Force Participation Rate
Source: NSS 55
th
,61
st
and 66
th
Rounds
Employment by Different Categories
Category of Worker 2004-05
(in million)
2009-10
(in million)
Self Employed 258.4
(56.4%)
232.7
(50.7%)
Regular /Salaried
Employee
69.7
(15.2%)
75.1
(16.4%)
Casual Labour 129.7
(28.3%)
151.3
(33.0%)
Source: Calculated from NSS 61
st
and 66
th
Rounds
Level of Education of the Labour Force
General education level of Indias labour force in the age group 15-59 remains
extremely low.


Numbers
(15-59)
(million.)
Share in Labour
Force in age group
15-59 (per cent)
Share in Labour
Force (470.1 million)
(per cent)
Not literate 125.65 29.14 26.73
Literate without formal
schooling
2.12 0.49 0.45
Below Primary + Primary 102.38 23.74 21.78
Middle 76.08 17.64 16.18
Secondary 52.39 12.15 11.14
Higher Secondary 29.19 6.77 6.21
Diploma/certificate course 6.02 1.40 1.28
Graduate 28.01 6.49 5.96
Graduate and above 9.40 2.18 2.00
Total 431.23 100.00 91.73
Source: NSS 66
th
Round 2009-10
Formal & Informal Employment (Millions)
Sectors 2004-05 2009-10
Formal 34.90 (7.6) 33.00 (7.2)
Informal 422.60 (92.4) 427.22 (92.8)
Total 457.50 460.22
Source: For 2009-10, computed from NSS 66
th
round; while for 2004-05 taken
from NCEUS, 2007
Sectors


2004-05
2009-10
Unorganized 394.9 387.34
Organized 62.6 72.88
Total 457.5 460.22
Organized & Unorganized Sector Employment (Million)
9




Proportionate Share of Sectors in Employment
59.9
11.1
5.3
23.7
56.6
12.2
6.5
24.7
53.2
11
10.5
25.3
0
10
20
30
40
50
60
70
Agriculture Manufacturing Non- Manufacturing Services
%

T
e
r
m
s

1999-00
2004-05
2009-10
Agriculture &
Allied
Manufacture
Non-
Manufacture
Service Total
Not Literate 87.36 9.56 14.42 13.65 124.99
Literate without
formal Schooling
1.23 0.25 0.21 0.42 2.11
Below Primary
+ Primary
57.62 12.69 12.47 18.32 101.1
Middle 36.2 10.27 8.67 18.98 74.12
Secondary 21.30 7.02 4.27 18.21 50.79
Higher Secondary 10.36 3.21 1.45 12.43 27.45
Diploma/Certificate
Course
0.58 1.16 0.53 3.12 5.39
Graduate 3.84 3.01 1.25 17.82 25.93
Graduate & Above 0.74 0.73 0.24 7.00 8.70
Total 219.23 47.90 43.50 109.96 420.59
Source: Computed from NSS (66
th
Round), 2009-10

Estimated Number of Workers by Level of Education by Sector (millions) in 2009-10

Trade Apprentices (M/o Labour & Employment)
Graduate, Technician & Technician (Vocational)
Apprentices (M/o HRD)
Year
Seat Available
(Lakhs)
Seat Utilised
(Lakhs)
Per Cent Utilised
Seat Available
(Lakhs)
Seat Utilised
(Lakhs)
Per Cent Utilised
Up to March 2011 3.37 2.21 65.57 1.02 0.65 63.74
Source : Ministry of Labour & Employment
Apprentices in India (Under the Apprenticeship Training Act ,1961)
Major Challenge Present Labour Market Scenario
Training Mismatch Labour Laws
84% of the unorganized sector
outside the purview of labour
laws
Informalization of employment
in the organized sector
Predominance of Unorganized
Sector
Inflexible labour laws viz;
Contract Labour (R&A)
Act, Apprentices Act,
Industrial Disputes Act etc
Skill mismatch-
Unemployment high
among educated
unemployed;
90% of workforce outside
the coverage of formal
training


Job Creation
Inclusive growth strategy
Emphasis on market-driven
Education & Training
Coordinated involvement of
Central Ministries/ States
Ineffective Models
Rethink in the Strategy
Objective to
achieve 50
million non-farm
employment by
2017
13

ACTION PLAN
Thrust on Manufacturing Sector to make it the engine of
employment growth that would create 10 million additional
jobs during the 12
th
Plan.
To bring in supportive policies to incentivize labour intensive
manufacturing sectors such as textile & garments, leather &
footwear, food processing, gems & jewellery to generate more
employment.
Expanding employment in services like IT, finance & banking,
tourism, trade & transport.
Prioritizing skill training for the informal sector; creation of
appropriate skill sets among rural migrants and urban poor to
make growth inclusive.

14

ACTION PLAN
Ensuring the employability of skill training by involving Sector Skill
Councils in preparation of Skill Modules matching market demand.
Building on the potential of Modular Employable Skill programme by
ensuring combination of modules to guarantee employability.
Extending Social Security benefits to Unorganized Sector workers.
Enable skill loans for poor students (Credit Guarantee Fund)
Streamlining the skill development programs for disadvantaged
sections to ensure much larger funding for skill development.
Setting up of National Skill Registry to link data bases across
Ministries/States to provide a platform linking people who seek/provide
employment.



15


To create 50 million additional non-farm job opportunities in
manufacturing and service sector.
Increase skilled workforce to at least 50 million.
Increase percentage of workforce receiving formal training from
present 10% to 25%.
Doubling the annual training capacity from the existing 4.5 million.





Expected Outcomes by 2017