Manufacturing employment almost half of what it was 5 years in the past

Manufacturing employment almost half of what it was 5 years in the past

With the second wave of the coronavirus pandemic battering India at current, the Indian financial outlook seems to be bleak for the second yr in a row. In 2020-21, India’s actual GDP progress is estimated to be minus 8 per cent. This is able to additionally put strain on India’s employment numbers. In earlier bulletins, we’ve got analysed the influence of Covid-19 pandemic on employment, particular person and family incomes and expenditures in 2020.

On this CEDA-CMIE Bulletin, we attempt to take a longer-term view of sector-wise employment in India. We base this on CMIE’s month-to-month time-series of employment by business going again to the yr 2016. For this bulletin, we’ve got centered on seven sectors – agriculture, mines, manufacturing, actual property and building, monetary companies, non-financial companies, and public administrative companies. These sectors make up for 99 per cent of complete employment within the nation.

Agriculture now employs extra folks than 5 years in the past

In determine 2 and three (beneath), we have a look at 4 sectors. These are agriculture, monetary companies, non-financial companies, and public administrative companies. Non-financial companies exclude public administrative companies and protection companies. Collectively, these accounted for 69 per cent of complete employment in 2016-17 and 78 per cent in 2020-21.

The agriculture sector employed 145.6 million folks in 2016-17. This elevated by 4 per cent to achieve 151.8 million in 2020-21. Whereas it constituted 36 per cent of all employment in 2016-17, the determine rose to 40 per cent in 2020-21, underlining the sector’s significance for the Indian economic system. Employment in agriculture has been on the rise over the past two years with year-on-year (YoY) progress charges of 1.7 per cent in 2019-20 and 4.1 per cent in 2020-21.


119.7 million Indians have been employed within the non-financial companies in 2016-17 (excluding these in public administrative companies and protection companies) (Determine 3). This quantity rose by 6.7 per cent to achieve 127.7 million in 2020-21. The monetary companies sector employed 5.3 million folks in 2016-17 and this grew by 9 per cent to five.8 million in 2020-21.

Public administrative companies employed 9.8 million folks in 2016-17 but it surely decreased by 19 per cent to 7.9 million in 2020-21.


Manufacturing employment almost half of what it was 5 years in the past

In determine 4, we have a look at employment in manufacturing, actual property & building, and mining sectors. Collectively these sectors accounted for 30 per cent of all employment in 2016-17 which got here all the way down to 21 per cent in 2020-21.

Manufacturing accounts for almost 17 per cent of India’s GDP however the sector has seen employment decline sharply within the final 5 years. From using 51 million Indians in 2016-17, employment within the sector declined by 46 per cent to achieve 27.3 million in 2020-21. This means the severity of the employment disaster in India predating the pandemic.

On a YoY foundation, it employed 32 per cent fewer folks in 2020-21 over 2019-20. It had seen a progress of 1 per cent (YoY) in 2019-20. This has occurred regardless of the Indian authorities’s push to enhance manufacturing within the nation with the ‘Make in India’ challenge. Below the challenge, India sought to create a further 100 million manufacturing jobs in India by 2022 and to extend manufacturing’s contribution to GDP to twenty per cent by 2025.

As an alternative of accelerating employment within the sector, we’ve got seen a pointy decline over the past 5 years. Once we look carefully at industries that make the manufacturing sector, we discover that it is a secular decline in employment throughout all sub-sectors, besides chemical industries.

All sub-sectors inside manufacturing registered a longer-term decline.

Actual property and building sector has additionally seen a pointy dip in employment over the five-year interval from 2016-17 to 2020-21. From using 69 million Indians in 2016-17, employment within the sector dipped by 25 per cent to achieve 53.7 million in 2020-21. The sector noticed employment dip by 12 per cent in 2020-21 (YoY) and a couple of.1 per cent in 2019-20 (YoY). Lately, the sector has been beset by problems with stock pile up, supply delays and developer failures. That is mirrored within the employment numbers. The troubled business has been hit additional by the coronavirus pandemic in 2020-21.

Mining business has additionally seen employment crash by 38 per cent over the five-year interval between 2016-17 and 2020-21. From using 1.4 million folks in 2016-17, the sector employed solely 0.88 million folks in 2020-21. India’s financial slowdown could be the cause responsible for the decline in employment within the sector. With demand falling within the metal, energy and building industries, mining has suffered successful.


Whereas the true property and building sector drove employment progress between 2004-11, it noticed a pointy decline between 2016-17 and 2020-21. We additionally see that there was hardly any supply of progress in employment on this interval. That is mirrored within the 7 per cent decline in total employment within the nation from 407 million in 2016-17 to 378 million in 2020-21.

These numbers present that the employment disaster in India predates the pandemic; the Covid-19 pandemic has made the roles plight much more extreme.

This text was initially printed by CEDA

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