24 February 2019
Data opacity hurting policymaking on jobs growth
Source: By Himanshu: Mint
The controversy over the release of Employment-Unemployment Survey (EUS) report, now known as Periodic Labour Force Survey (PLFS), is not just a debate on the estimates of employment and unemployment in the country, but is at the root of the independence of the statistical system. There are already several estimates of unemployment and job creation during the tenure of this government that has come out. Estimates of unemployment and labour force estimates from private bodies, such as Centre for Monitoring Indian Economy (CMIE), and the government’s own estimates from the annual employment surveys of the Labour Bureau have more or less confirmed what the Business Standard has reported based on the leaked estimates of employment and unemployment.
However, even in the absence of these official and unofficial statistics, there is enough evidence that this government has failed in providing employment that is required for a growing economy like India and meeting its own promise of creating millions of jobs per year. Much before the PLFS reports were released, the annual employment surveys of the Labour Bureau had shown that the number of workers in the economy declined by 16 million between 2014 and 2016.
Some indication of this was also available in the quarterly employment surveys of the Labour Bureau, which showed that growth of employment in some non-agricultural sectors had halved during the tenure of this government compared to the previous one. While official population projections from the Registrar General of India have not been released so far, back-of-the-envelope calculations show that the latest PLFS estimates suggest a decline of 18 million workers between 2011-12 and 2017-18.
The debate is not about whether this government has created jobs or not, but about the seriousness of the government in finding a solution to the problem of jobless growth, which has plagued even the earlier government. One of the reasons for the huge dissatisfaction with the previous government, which ultimately also led to its electoral defeat, was the inability of the economy to create decent jobs despite high growth rates of national income. This is a serious issue and has been a problem for successive governments. Any attempt to obfuscate the matter is not only futile but also counterproductive.
The government, by denying access to the data, is not only doing a great disservice to the public, which has a right to know how the economy is doing on employment generation, but is also depriving policymakers of the right information needed to find a solution to the problem of jobless growth.
The attempt by the government to confuse matters by claiming the Employees’ Provident Fund Organisation (EPFO) numbers, as well as the Uber and Ola enrolments, as employment creation is not only ridiculous but also against its own expert group report, which treated them at best as measures of formalization and not of employment generated. However, these do not take away the blame from this government for first delaying the EUS surveys, which should have happened earlier, but also for denying access to the results and data.
What is worrying is that some of these criticisms of official data came from the highest body created to advise the government on policy matters, the Niti Aayog. The defence by its vice-chairman and the chief executive officer only proved the ignorance of the top two officials of the Niti Aayog about the nature and state of official statistics. Later attempts at raising questions on methodology and sampling are not as much a question on the state of statistics as they are on the competence of the body meant to advise the government on policy matters.
It is not just the ignorance of the Niti Aayog about the statistical system but also the approach to the issue of employment that should worry the public and policymakers. The first step to solving the problem is to acknowledge the fact that India does have a jobs crisis. Even before the leaked report, employment was a political issue and will remain so in the absence of official estimates.
There is enough anecdotal evidence on the number of graduates and higher educated who are applying for lower level jobs in the government. Last year, 93,000 candidates, including 3,700 PhDs, 28,000 postgraduates and 50,000 graduates applied for the job of 62 police messengers in Uttar Pradesh, the minimum qualification for which is Class IV-pass. The demand for reservation among the affluent agricultural communities of Jats, Patels and Marathas is another example of the extent of the job crisis. None of these require any substantiation from the National Sample Survey Office or the Niti Aayog.
Clearly, the Niti Aayog is mistaken that by suppressing the employment report and discrediting it on grounds of sampling and methodology, it has managed to solve the job crisis. It certainly hasn’t diminished the reputation of the statistical system. The resignation of the two non-official members, both reputed professionals in their field, has only confirmed doubts about the interference of government in the statistical system. The biggest loser in this debate is the Niti Aayog, which is tasked with designing policies for this government.