Indian economy needs to create enough good, safe, productive, well-paying jobs, the Economic Survey 2015-16 said on Friday.
India's most pressing labour market challenge going forward will be to generate a large number of "good jobs" -- jobs that are safe and also pay well, the Economic Survey 2015-16 said on Friday.
In order to take advantage of the democratic dividend and meet growing aspirations of those entering the workforce, the economy needs jobs that are good, safe, productive and well-paying," as per the 2015-16 report card of the state of the economy tabled by Finance Minister Arun Jaitley in Parliament on Friday.
"Indian economy needs to create enough 'good', safe, productive, well-paying jobs," the survey said adding "these jobs tend to be formal sector jobs".
The survey says that there are two obstacles to creating good jobs -- Regulation-induced taxes on formal workers and a spatial mismatch between workers and jobs.
"Meeting the challenge ahead will require more of such ingenuity, and the private sector, state governments and the Centre will all have important roles to play," it added.
Around 10.5 million new jobs were created between 1989 and 2010, only 3.7 million -- or about 35% were in the formal sector.
However, on the other hand, the survey noted an increase in the number of contract labour jobs created. Contract labourers went up 12% of all registered manufacturing workers in 1999 to over 25% in 2010 as firms were looking to boost production without facing labour unrest.
Talking about increasing productivity in the apparel sector, the survey suggests that relocating the capital from less productive firms to more productive ones can help.
The apparel sector in the country is dominated by informal firms where around two million establishments employing about 33,00,000 workers, dwarf the formal apparel sector's 2,800 firms which employ 3,30,000 workers.
"To boost the country's economy, the centre has to ensure that labour regulation is worker-centric, by expanding workers choice and reducing mandatory taxes on formal sector employment," the survey said.
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