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Demographic Dividend Amidst COVID-19: Demand For Comprehensive Policies For Youth Employment

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As the coronavirus pandemic has continued to prevail, it has exacerbated the challenge of limited employment opportunities for the youth during this period. The policy steps taken by authorities have resulted in a slowdown in economic activities, leading to mass unemployment. According to the International Labour Organisation (ILO) report titled COVID-19 and the world of work (fourth edition) published on 27 May, 2020, around 94% of the world’s workers are living in countries with some workplace closure measures in place. 

There is an urgent demand for comprehensive policies that protect the youth and create new employment opportunities. Keeping this in mind, on the occasion of World Population Day 2020, Centre for Work and Welfare, Impact and Policy Research Institute (IMPRI), New Delhi, organised a panel discussion on Harnessing the Demographic Dividend amidst the COVID-19 Pandemic in India: The Way Forward for Youth Employment and Opportunities. 

Dr Simi Mehta, CEO and Editorial Director, IMPRI, introduced the topic and welcomed the panel and commenced the discussion by acknowledging the occasion. She stated that the World Population Day had been observed every year since 1989 when the Governing Council of the United Nations Development Programme took inspiration from the Five Billion Day (11 July, 1987). The significance of World Population Day is that it draws the attention of the global community to population issues and their contemporary challenges for society, especially the youth. 

28% of India’s population is 10 to 24 year-olds, adding that the youth population is growing fastest in the poorest nations. Global number of youths is highest ever.

In India, the primary concern for the community at large is the growing population — with the largest youth population, i.e. 28% of the total population of the country. She further stated that this youth population of the country is considered as the “demographic dividend”. It implies that if the available youth of the country is equipped with quality education and skill training they will be able to seek decent and relevant jobs according to their skills and training. 

The ultimate result of this approach leads to the economic development of the nation. She highlighted the growing debate of “disaster and dividend” where the youth of the country are increasingly anxious about their jobs. 

PC Mohanan, former Acting Chairperson, National Statistical Commission, Government of India, chaired the panel discussion and acknowledged that there is a need for discussion on the theme of youth employment during the times of the Coronavirus pandemic. He initiated the discussion by explaining the meaning of demographic dividend. He stated that it’s a technical term which implies the demographic transition and is a slow process which gradually takes place in the economy of every country. 

He also stated that the proportion of persons below the age of 20 years was 51% in the 1970s, currently 41% and will be 22% by 2050. This results in a demographic shift. Hence, by 2050, India will lose its demographic advantage. He highlighted that the median age of the population is 28 years in India, 48.6 years in Japan and 42 years in China. He asserted that this numerical data clearly shows the demographic advantage in favour of India. 

Mr Mohanan raised the question of how to utilise this demographic advantage and convert it into a demographic dividend and suggested that it’s possible when the youthful workforce of the country becomes employable. While stating the data about employability he said that it was unfortunate that India had the highest unemployment rate, i.e. 15–29%. The unemployment challenges in front of the nation affect its demographic advantage. He recognised the challenge of the current pandemic which has become a hurdle in employment and economic activities of the country. 

Dr Simi Mehta (CEO and Editorial Director IMPRI); Dr Arjun Kumar (Director, IMPRI, Ranchi and China-India Visiting Scholars Fellow, Ashoka University) and Prof Balwant Singh Mehta (Research Director, IMPRI, Lucknow, and Senior Fellow, Institute for Human Development, Delhi) delivered a presentation on the theme of the discussion. 

Dr Mehta introduced demographic dividend as the benefit a country gets when its working population outgrows its dependents such as children and older people. She explained the stages involved in the demographic dividends, which include: 

  1. Improved income and health reduce infant mortality and a baby boom arises. 
  2. The baby boomers, once regarded as the population curse, grow up to create an unprecedentedly large army of income earners, thereby, boosting the GDP. 
  3. Demographic dividend starts disappearing; for instance, in Japan, Germany, Russia and Italy (among others), when baby boomers begin to retire, the proportion of non-earners rises rapidly. 

Dr Kumar presented a summary of demographic dividend in Asia. He referred to Mr Mohanan’s remarks and discussed the differences in median age in North, West, Central and South-East Asia. He talked about the demographic transition and stated that it happened primarily because of a decrease in the Total Fertility Rate (TFR) and that there was a need to utilise this demographic transition wisely and diligently. 

He highlighted that the working-age population in the country forms two-thirds of the total population. Further, only one-third of those of working age are employed and this presents the problem of unemployment and under-employment. Dr Kumar also expressed concerns over non-participation of educated women in the employment process and market, as reported in various surveys, and unemployability of a majority of the educated youth due to lack of skill and training. 

The 2001 census reports that 87.3% of office clerks, and 93.1% of sales jobs were held by men.

Prof Mehta, while discussing demography and the youth in India, indicated that it’s wrong to assume that the demographic dividend in India is the same throughout. It differs from State to State and depends upon the various government policies and their impact. He stated that by 2030, India would be the most populous country with 1.46 billion people, surpassing China’s projected population of 1.39 billion. He shared that the median age for India would be 32 years in 2030 — much younger than the U.S.A. (39), U.K. (42), China (43) and Brazil (35). 

Prof Mehta presented comparative data for Indian states and discussed the role of education and skills in the demographic dividend. He highlighted that 28% of the Indian population belonged to the age group of 15–29 years and half of the youth had less than secondary education or were illiterate and only 13% were graduates. Discussing employment and unemployment in this context, he mentioned that only 5.5 million additional jobs had been created in the country during 2017–18, against the 8 million youth that had entered the job market. He expressed concerns over India’s 6.1% overall unemployment — the highest in 45 years. 

Prof Mehta also discussed the slowdown of economic growth and structural weakness in the financial sector as impacts of the COVID-19 pandemic and lockdown. He shared that as per the Centre for Monitoring Indian Economy (CMIE), the unemployment rate was at a record high of 24% during this time.

Mr Toshi Wungtung, Member of Legislative Assembly, Shamator Chessore Constituency, Nagaland, focused on the impact of the pandemic in the State of Nagaland. He indicated that although the number of cases in Nagaland was low, there was an effect on the nature of the economic activities of the State. The sudden shutdown of industries, factories and other departmental activities has hugely affected the people of Nagaland. 

Mr Wungtung shared that 70% of construction workers left the State due to COVID-19. The Transport Department incurred huge costs due to the closure of transport, and tourism had stopped. He expressed that there is a need for serious, comprehensive steps to be taken by both the government and members of civil society in such times that would help revive the economy and ensure employment to the people of the State and migrants. 

Stranded migrant workers
100 million migrant workers in India – 20% of the workforce – leave their villages for jobs in cities, where their skills are needed in manufacturing, construction, or the hospitality industry.
Credit: Wikimedia Commons

Prof Vinoj Abraham, Centre for Development Studies, Thiruvananthapuram, stated that the demographic dividend was not automatically perceived; it’s attached with the demographic transition. He discussed the economic perspective of demographic transition, i.e. the demographic transition of an economy is closely linked with the structural transition of an economy. For instance, there is always a shift from agricultural to service to the secondary sector. This is part of the structural transition in European countries. He said that India had a demographic transition, not a structural one. 

Prof Abraham further asserted that without addressing the female workforce participation — which he considers the core of the demographic dividend — the accurate picture couldn’t be shown. He attributed low female participation in the market to cultural norms. He also focused on employability and stated that a large segment of the workforce was highly unskilled or lacked proper training and which lead to the high unemployment rate in the country. He suggested decentralisation and deregulation of the economy, a reimagining of economic approaches, and promotion of small scale industries as some of the possible ways to generate employment and utilise the workforce in the market. 

Prof Anjana Thampi, Assistant Professor, Jindal Global Law School, Sonepat, began her discussion on the situation of the workforce by quoting newspaper reports of PhD Scholars applying for peon and clerk positions in government departments. She stated that a lack of skills and course curriculum which do not support the market demand and supply lead to unemployment, especially among the youth of the country, at a large scale. 

Prof Thampi highlighted that women in both urban and rural regions were primarily affected by the pandemic. Urban women had lost their jobs, while household chores for women in rural areas had increased. She shared that 27 million youth in India had lost their jobs in April 2020 alone, as reported by CMIE. She ended by proposing a generation of good jobs and guaranteed employment under government schemes to the poor section of society and redesigning economic sectors, among other possible plans of action. 

Ritika Gupta and Anshula Mehta, Senior Research Assistants at IMPRI, presented an article titled Work-Life of the Youth in the Times of COVID-19: Perplexed State of Mind, Especially for Young Indian Women from the Journal of Development Policy Review (JDPR) by IMPRI. 

Ms Gupta stated the challenges faced by the youth which include:

  • A lack of knowledge about where and how to look for jobs.
  • Outdated skills that do not address the labour demands.
  • Education and job mismatch.

She discussed the sectoral composition and said that there had been a gradual shift from the agricultural sector and the manufacturing sector to the non-manufacturing sector and service sector. She also stated the reasons for the rural-urban migration which include:

  • Good Quality of Education.
  • Highest paying jobs.
  • Good quality of life.

She presented data relating to the “gender divide” for the youth as follows: 

  • Unemployment Rate: 18.7% among males and 27.2% among females. 
  • Work Participation Rate: around three-fifths for males and one-fifth for females. 
  • Graduates: 47.7% of males and 29.7% of females. 

Ms Gupta also shared the social and psychological facets of unemployment faced by the youth in India. She proceeded to list the reasons for prevailing unemployment, viz., institutional failure, an ill-organised labour market, skill mismatch, low prevalence of technical training among youth workforce and demand-driven employment and supply-driven education. She mentioned government schemes aimed at making the youth “Atma-Nirbhar” or self-reliant such as Startup India, Pradhan Mantri Rozgar Protsahan Yojna, Prime Minister Employment Generation Scheme, among others. 

She suggested an assured employment scheme (especially in urban areas) as well as an expansion of apprenticeship and training and internship programs with a focus on technical and soft skills, along with an alignment of educational curriculum with industry requirements as opportunities for harnessing the demographic dividend effectively. 

Ms Mehta highlighted that the pandemic and lockdown had led to a large number of layoffs by companies to cut costs, leaving the youth vulnerable and uncertain. The uncertainty about prospects of higher education and employment along with a restriction on mobility had added to the worry of the youth, especially women, and left them unable to address it. She suggested that the youth was aspirational and resilient despite challenges and only needed a support system and direction to move ahead. 

Dr Simi Mehta concluded the session by thanking the Chair and panellists for sharing their intellectual insights into the demographic dividend and youth employment during the pandemic and assured that such policy debates and discussions would continue to be held around important issues.

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