India will fail to plug jobs gap even with 7% growth, Citi says

[andhra_jp]

Citi estimates India will need to create about 12 million jobs a year over the next decade to absorb the number of new entrants to the labor market. Based on a growth rate of 7%, India can only generate 8-9 million jobs a year, the bank’s economists Samiran Chakraborty and Baqar Zaidi wrote in a report this week.

 

 

Citi’s economists propose a series of measures to boost jobs in India, such as strengthening the export potential of manufacturing sectors, extending incentives to attract foreign companies and filling up about 1 million government vacancies. The government also needs to consolidate multiple employment generation programs for better impact, the economists said.

The quality of jobs being created in India is another challenge, the economists said. An analysis of the official data showed about 46% of the workforce is still employed in agriculture, even though the sector contributes less than 20% to gross domestic product. Manufacturing accounted for 11.4% of total jobs in 2023, a lower share than in 2018, the figures show, a sign that the sector hasn’t bounced back since the pandemic.