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Economy
Mahesh

27/12/23 06:17 AM IST

Are graduates facing unemployment?

In News
  • The unemployment rate, which hit a high of 6.1% in 2017-18, has reduced to 3.2% in 2022-23, according to the latest data from the Periodic Labour Force Survey (PLFS).
Key Findings
  • The unemployment rates for the aggregate labour force of individuals aged 18 to 65.
  • Unemployment rates had always been low since the early 1990s, jumping to a historical high of 5.77% in 2017-18. By 2022-23, the unemployment rate showed signs of reducing, falling to 3.15% for this cohort.
  • While unemployment rates are currently higher than in previous decades, it has shown a reduction compared to 2017-18. 
  • Individuals with higher education have always faced higher unemployment rates than the rest of the population, a situation that has characterised the Indian economy since the 1990s.
  • The unemployment rates for those with graduate degrees. From roughly 9% in the 1990s, the rate fell to 7.66% in 2011-12, before rising to 17% in 2017-18 and then 13% in 2022-23.
  • From 1993-94 to 2004-05, almost a fifth to a quarter of all young individuals with graduate degrees faced long unemployment spells of 6 months or more.
  • The rate dropped to 20% in 2011-12, before rising to a staggering 36% in 2017-18. The rate has been reduced by 2022-23 with 27% of young graduates facing long spells of unemployment.
  • Earlier, these high rates of unemployment were concentrated amongst a relatively small section of the labour force.
  • Overall unemployment rates remain low even though graduates face high unemployment because the share of educated workers in the labour force is low.
  • As enrolment rates continue to rise, the share of graduates in the labour force will increase, leading to increases in the aggregate unemployment rate. The problems of young job-seekers are not an aberration, but a worrying feature of the Indian labour market.
Causes
  • The problem of youth unemployment is a serious issue.
  • Much more work is required to outline the exact factors causing unemployment amongst the highly educated - be it the inability of the education system to impart the requisite skills, or the inability of the growing economy to generate enough jobs for the increasing numbers of educated job-seekers entering the labour force each year - to ensure that the aspirations of the youth are not thwarted and the potential of the demographic dividend is properly harnessed.
Source- The Hindu

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