Given GDP continued to slow in Q3, and the IIP data just out—it contracted 1.9% in February—suggests Q4 may not be much better, it is not surprising the latest quarterly survey of labour bureau shows jobs in the eight key sectors recorded the slowest growth in six quarters. Registering a fall of 42% on a quarter-on-quarter basis, employment in these sectors, including automobiles and textiles, grew by 83,000 in the third quarter—the slowest since April to June 2012 when just 73,000 new jobs were added. While 93,000 jobs were added in the textiles sector and 17,000 in the IT/BPO sector, 20,000 jobs were lost in the metals sector and 11,000 in the automobile sector during October-December, 2013. Given the continued poor performance of these sectors in recent months, the chances of getting jobs back on track is a difficult one.
A revival in the economy will, undoubtedly, generate more jobs. And if exports pick up, particularly in segments like readymade garments, this will give a fillip to the jobs market. But, at an overall level, the employment intensity of jobs is down in a big way. Fixing that will require not just trade unions getting more responsible, the government will also have to chip in. The unending flow of social security schemes, along with fixing higher minimum wages, is forcing firms to think of more ways to keep labour-intensity down to the minimum.