In Employment in India, Ajit Kumar Ghose offers a concise guide to understanding different aspects of employment in India, written using accessible language for a general audience. With the book’s analysis supported by rigorous empirical work and up-to-date data, Varsha Gupta recommends it to researchers of labour economics

Gupta, Varsha

English

LSE Research Online

Book	Review:	Employment	in	India	by	Ajit	KumarGhoseIn	Employment	in	India,	Ajit	Kumar	Ghose	offers	a	concise	guide	to	understanding	different	aspects	ofemployment	in	India,	written	using	accessible	language	for	a	general	audience.	With	the	book’s	analysis	supportedby	rigorous	empirical	work	and	up-to-date	data,	Varsha	Gupta	recommends	it	to	researchers	of	labour	economics.	Employment	in	India.	Ajit	Kumar	Ghose.	Oxford	University	Press.	2020.Employment	in	India	by	Professor	Ajit	Kumar	Ghose	is	a	primer	to	understanding	theIndian	employment	scenario	since	Independence.	Part	of	the	Oxford	India	‘ShortIntroductions’	series,	it’s	a	concise	guide	to	different	aspects	of	employment	in	India,written	using	accessible	language	for	a	general	audience.	The	insights	and	factspresented	are	up-to-date,	using	the	2016	employment	data,	while	the	epilogue	providesstatistics	using	the	Periodic	Labour	Force	Survey	(PLFS)	2017-18	data.The	book	is	divided	into	five	chapters,	with	the	first	two	chapters	introducing	the	variousdefinitions	and	concepts	used	in	the	book	to	underline	the	nature	and	characteristics	ofemployment.	The	third	chapter	is	empirical	and	charts	the	trends	for	six	decades	usingfour	sources	of	data:	the	Employment-Unemployment	survey	by	the	National	SampleSurvey	Organisation	(NSSO);	annual	data	on	employment	by	the	Labour	Bureau;organised	sector	data	by	the	Directorate	General	of	Employment	and	Training	(DGET);and	the	Census.	In	the	fourth	chapter,	the	reasons	behind	the	trends	are	explained,while	the	concluding	chapter	outlines	an	optimal	strategy	to	meet	the	employmentchallenges	of	India	and	discusses	the	future.The	author	begins	by	outlining	the	growth	strategy	since	Independence,	which	has	been	more	inclined	towards	theservice	sector	and	is	driven	more	by	domestic	demand	than	exports.	The	Indian	economy	skipped	the	growth	inmanufacturing	where	returns	to	scale	are	higher	and	positive	spillovers	can	be	attained.	Before	delineating	theemployment	patterns	using	data,	the	second	chapter	discusses	the	various	terms	often	used	in	labour	studies	andthis	book,	including	the	modern	sector,	the	traditional	sector,	wage	and	self-employment	as	types	of	employment,the	formal	and	informal	sector,	structural	change	etc.	It	provides	the	reader	with	clarity	on	these	concepts	beforethey	are	used	in	further	analysis.	Details	on	the	Lewis	model	(which	shows	that	as	a	country	develops,	there	ismovement	of	labour	from	agriculture	to	the	modern	sector),	the	interlinkages	between	the	modern	(formal)	andtraditional	(informal)	sector	and	the	role	of	employment	in	connecting	economic	growth	and	development	constitutethe	rest	of	the	chapter.In	the	third	chapter,	trends	of	employment	indicators	are	brought	out	for	the	period	1950	to	2016,	alongside	a	list	ofall	the	various	data	sources	used.	It	is	an	exhaustive	list	for	early	career	researchers	in	labour	economics.	It	ishighlighted	that	the	low	unemployment	figures,	which	are	often	taken	to	be	a	positive	reflection	of	the	labourmarket,	do	not	present	a	bright	scenario	in	a	developing	country	like	India	as	it	does	not	indicate	full	employment.Being	unemployed	is	a	luxury	here,	and	only	a	few	can	afford	it;	the	rest	take	up	whatever	employment	is	availableto	them.	Three	pieces	of	information	emerge	from	the	analysis;	the	unemployed	in	India	are	less	poor	and	moreeducated;	the	rate	of	unemployment	increases	with	education	level;	and	it	decreases	with	age	as	some	individualsget	employed	while	others	leave	the	workforce	altogether.LSE Review of Books: Book Review: Employment in India by Ajit Kumar Ghose Page 1 of 3		Date originally posted: 2020-09-29Permalink: https://blogs.lse.ac.uk/lsereviewofbooks/2020/09/29/book-review-employment-in-india-by-ajit-kumar-ghose/Blog homepage: https://blogs.lse.ac.uk/lsereviewofbooks/In	addition,	on	pages	53-54,	the	author	talks	about	low	female	employment	and	the	reasons	behind	it.	Reduction	indistress	participation	(work	undertaken	in	times	of	economic	hardship)	along	with	poor	demand	for	female	labourare	major	factors.	The	author	mentions	that	‘withdrawal	from	poor	jobs	did	not	have	to	mean	withdrawal	from	thelabour	force’,	pointing	towards	the	unavailability	of	better	jobs	for	women.Furthermore,	trend	analysis	on	pages	57-80	draws	out	the	structure	of	employment.	Self-employment	has	gonedown,	while	the	share	of	wage	employment	has	increased	in	total	employment.	This	is	in	line	with	the	iron	law-importance	of	agriculture	in	employment	declines	and	wage	employment’s	share	rises	as	a	country	experienceseconomic	growth.	The	share	of	formal	employment	in	India	went	up	until	1973	and	declined	thereafter.	It	went	upagain	between	2005	and	2012.	The	Employment	Quality	Index,	developed	in	the	author’s	previous	work	tostatistically	measure	employment	conditions,	is	calculated	for	the	period	1955	to	2016	and	on	average	presents	aslight	decline.In	the	fourth	chapter,	the	author	explores	the	relationship	between	economic	growth	and	employment.	While	growthhasn’t	been	poor	in	India,	employment	indicators	reflect	a	poor	scenario.	Decent	growth	was	experienced	by	theIndian	economy,	especially	after	liberalisation	reforms	in	1991	were	introduced,	due	to	overseas	finance	andremittances.	The	service	sector	took	the	lead:	an	enigma	which	is	peculiar	to	India.	The	process	of	structuraltransformation,	brought	about	by	growth	in	the	modern	or	non-agricultural	sector,	did	not	occur	in	India.	This	isreflected	in	the	statistical	indicator	‘employment	elasticity’	(percentage	change	in	employment	associated	with	a	1percentage	point	change	in	economic	growth)	of	non-agricultural	growth.	It	declined	during	the	period	1978-2000and	2000-12,	implying	that	labour	was	not	pulled	out	of	agriculture	at	a	fast	rate.	The	failure	of	the	manufacturingsector	and	the	low	employment	intensity	of	the	service	sector	are	two	factors	behind	this.	Within	the	service	sector,the	skills-intensive	areas	of	‘communication,	finance	and	business	services’	led	the	growth.	This	eventually	led	toslow	absorption	of	the	abundant	low-skilled	labour	available	in	the	country.LSE Review of Books: Book Review: Employment in India by Ajit Kumar Ghose Page 2 of 3		Date originally posted: 2020-09-29Permalink: https://blogs.lse.ac.uk/lsereviewofbooks/2020/09/29/book-review-employment-in-india-by-ajit-kumar-ghose/Blog homepage: https://blogs.lse.ac.uk/lsereviewofbooks/After	drawing	out	the	employment	situation	in	India	and	the	explanations	for	it,	the	author	provides	a	roadmap	toachieve	development	via	employment	generation	in	the	last	chapter.	India	needs	to	create	12.5	million	jobs	perannum	with	a	focus	on	low-skilled	workers	in	order	to	enable	the	economy	to	reach	the	point	where	there	are	nosurplus	workers	(the	Lewis	turning	point).	While	research	often	highlights	the	significance	of	employment	creationfor	the	educated	and	the	skilled,	the	author	places	emphasis	on	low-skilled	employment.	Employment	generation	inthe	non-agricultural	modern	sector	and	productivity	increases	in	existing	jobs	in	agriculture	are	required.	Astructural	transformation	process	where	growth	is	concentrated	on	manufacturing	rather	than	service-led	can	bringthe	desired	changes	in	the	Indian	job	market	(138-40).	The	concern	regarding	automation	replacing	low-skilledlabour	in	manufacturing	is	also	discussed.	Up	until	now,	this	has	occurred	primarily	in	capital	and	skill-intensivesectors	of	manufacturing.	So,	the	strength	of	manufacturing	in	employment	remains,	even	in	the	twenty-firstcentury.This	book	offers	a	comprehensive	analysis	of	employment	in	the	Indian	economy.	The	nature	of	the	employmentchallenges	faced	by	India	and	the	growth	pathway	required	to	meet	them	are	summarised.	However,	it’s	a	longread	for	a	non-specialist	reader.	Since	it	touches	upon	the	various	aspects	of	employment	using	data,	this	candetract	from	the	larger	narrative	for	the	reader.	That	being	said,	the	information	provided	in	various	boxes	is	usefulfor	researchers	in	labour	economics,	with	definitions	given	for	various	concepts	and	indexes	used	in	the	analysis.Throughout	the	book,	the	analysis	is	supported	by	rigorous	empirical	work	and	the	epilogue	updates	it	with	thelatest	available	data.	Employment	in	India	is	recommended	for	students	in	labour	economics.Note:	This	review	gives	the	views	of	the	author,	and	not	the	position	of	the	LSE	Review	of	Books	blog,	or	of	theLondon	School	of	Economics.	Banner	Image	Credit:	Working	professionals	in	a	co-working	space	in	Delhi.	Copyright	ILO/L.	Mitul	2018	(ILO	Asia-Pacific	CC	BY	ND	NC	2.0).In-text	Image	Credit:	Image	by	Nandalal	Sarkar	from	Pixabay.	LSE Review of Books: Book Review: Employment in India by Ajit Kumar Ghose Page 3 of 3		Date originally posted: 2020-09-29Permalink: https://blogs.lse.ac.uk/lsereviewofbooks/2020/09/29/book-review-employment-in-india-by-ajit-kumar-ghose/Blog homepage: https://blogs.lse.ac.uk/lsereviewofbooks/

Book review: employment in india by Ajit Kumar Ghose

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Book review: employment in india by Ajit Kumar Ghose

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