Growth and changing structure of employment

Between 1951 and 2023, India's GDP grew faster than employment. Employment grew by not more than 2 per cent a year most of the time, and from the late 1990s the gap widened. When an economy produces more goods and services without a matching rise in jobs, it is called jobless growth.

The structure of employment has changed slowly. The primary sector's share of the workforce fell from 74.3 per cent (1972-73) to 46.1 per cent (2023-24). The secondary sector's share rose from 10.9 to 24.1 per cent, and services from 14.8 to 29.8 per cent. When an industry grows, it creates jobs in connected activities too, such as transport.

The status of workers changed as well. The share of casual labour rose until 1993-94 (to 31.8 per cent), and has fallen since (to 19.9 per cent in 2023-24). Self-employment rose again after 2011-12, and between 2017 and 2024 there was a moderate rise in regular salaried jobs.

When workers move from self-employment and regular jobs into casual wage work, it is called casualisation. Casual workers are vulnerable: they have no regular income, no job security and no social security (pension, paid leave, health benefits). When the textile mills of Ahmedabad closed down, many of their workers had to take up casual and informal work, and fell into poverty.

So India's growth brought more output, but not enough jobs, and often worse ones.