Economic growth in The recent past has been led by increase in labour activity. “Explain this statement. Suggest the growth pattern that will lead to creation of more jobs without compromising labour productivity. (250 Words 15 Marks)

The recent Economic growth hinges on heightened labor activity, reflecting increased employment opportunities. A sustainable growth pattern involves prioritizing sectors with high job creation potential, fostering skill development, and embracing technology to enhance labor productivity. Balancing job creation and efficiency ensures a robust, inclusive economic expansion.

UPSC Mains General Studies Paper – 3 Mains 2022

UPSC Mains Civil Services IAS Exam Question Paper – 2022

Approach

• Start with Give brief intro of the keyword Economic growth reference to labour productivity. 
• Discuss on “Economic growth in the recent past has been led by an increase in labour productivity”. 
• Give suggestions to Growth patterns that will lead to creation of more jobs without compromising labour productivity. 
• Conclusion to accordingly.  

Introduction 

• Economic growth can be defined as an increase in the value of goods and services produced in an economy over a period of time. This value calculation is done in terms of % increase in GDP or Gross Domestic Product. Labour productivity is an indicator of the efficiency of a country’s workforce, providing a measure of the average output generated per worker (or per hour worked).It is calculated by dividing the total output of goods and services by the number of labour hours used to produce them. 

Body  

Economic growth in the recent past has been led by an increase in labour productivity:  

• The labour productivity growth in India measured in terms of growth in real GDP per person employed for the two time periods show that it was 3.0% during 2000-2005, while it increased at an annual rate of 6. 7% during 2005-2013 period. 
• The Labour Productivity growth during 2000-2013 in India has all along been better than the comparative position in respect of benchmark countries such as the United States (except China). This accounts for the progress achieved by the Indian Economy through higher labour productivity post globalisation. 
• During the Covid-19 pandemic,Working from home has allowed people to dedicate more time to their respective economic engagements and vocations resulting in higher labour activity and resultantly productivity. 
• Sectors such as manufacturing (7.2%), electricity, gas, and water supply (7.7%), transport, storage, and communications (7.4%), and community, social, and personal services (6.2%) contributed significantly to the overall labour productivity during FY00-FY16. 

Growth pattern that will lead to creation of more jobs without compromising labour productivity: 

1. Labour Intensive Industries: Special packages are needed for labour-intensive industries to create jobs. The apparel and garments sector received a package from the Government of India roughly a year back. The other labour intensive sectors such as furniture, leather, footwear, food processing have been ignored. 
2. Cluster Development: There are 1,350 modern industry clusters in India and an additional 4,000 traditional product manufacturing clusters, like handloom, handicraft and other traditional single product group clusters. There is a cluster development programme of the Ministry of MSMEs, which is poorly funded and could be better designed as well. The traditional manufacturing clusters must be focused on a mission mode to increase productivity. 
3. Invest in education and training: Educating and training the workforce can increase productivity and innovation, leading to long-term economic growth. 
4. Promote entrepreneurship and innovation: Encouraging entrepreneurship and supporting innovation can lead to the development of new products, services, and industries, driving economic growth. 
5. Promote sustainable development: Investing in sustainable development can lead to long-term economic growth by protecting the environment and improving the well-being of the population. 
6. Address inequality and promote inclusive growth: Skilling close to tier 2 and tier 3 cities (rather than standalone vocational training providers), where the women workforce is concentrated, is likely to be more successful in increasing their participation and productivity. 
7. Health care services, Job creation and labour productivity: Public investment in the health sector has remained even in the last three years at 1.15% of GDP, despite the creation of the national health policy which recommends 2.5% of GDP. Health has a direct bearing on productivity of labour. 

Conclusion 

• Hence, India’s highly segmented labour market, one can still discern at least three demographic groups that are in urgent need of jobs: a growing number of better educated youth; uneducated agricultural workers who wish to leave agricultural distress behind; and young women, who too are better educated than ever before. 

In case you still have your doubts, contact us on 8792740517. 

For UPSC Prelims Resources, Click here

For Daily Updates and Study Material:

Join our Telegram Channel – Edukemy for IAS

• 1. Learn through Videos – here
• 2. Be Exam Ready by Practicing Daily MCQs – here
• 3. Daily Newsletter – Get all your Current Affairs Covered – here
• 4. Mains Answer Writing Practice – here