{"id":42485,"date":"2024-09-16T09:08:25","date_gmt":"2024-09-16T03:38:25","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=42485"},"modified":"2025-05-05T10:28:41","modified_gmt":"2025-05-05T04:58:41","slug":"divide-between-high-skilled-and-low-skilled-jobs-in-india","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/divide-between-high-skilled-and-low-skilled-jobs-in-india\/","title":{"rendered":"Divide Between High-Skilled and Low-Skilled Jobs in India"},"content":{"rendered":"<h2><strong>What\u2019s in today\u2019s article?<\/strong><\/h2>\n<ul>\n<li>Why in News?<\/li>\n<li>What is Happening in the Job Sector in India?<\/li>\n<li>Why are These Trends in the Job Sector Concerning?<\/li>\n<li>Way Ahead to Boost Jobs in India (Particularly in the Labour-Intensive Sectors)<\/li>\n<\/ul>\n<h2><strong>Why in News?<\/strong><\/h2>\n<ul>\n<li>A country with a population of 1.4 billion cannot rely entirely on the services sector to contribute to job creation, since this will increase the gap between high-skilled and low-skilled jobs.<\/li>\n<\/ul>\n<h2><strong>What is Happening in the Job Sector in India?<\/strong><\/h2>\n<figure class=\"image image_resized\"><img decoding=\"async\" src=\"https:\/\/vajiram-prod.s3.ap-south-1.amazonaws.com\/Recent_Trends_in_Job_Sector_in_India_aa79b28156.webp\" alt=\"Recent Trends in Job Sector in India.webp\" \/><\/figure>\n<ul>\n<li><strong>Decline in labour-intensive jobs:<\/strong>\n<ul>\n<li><strong>The Indian economic growth has increasingly been driven by the services sector<\/strong>, particularly in IT, banking and finance, over the past two decades.<\/li>\n<li>This has coincided with a noticeable decline in traditional industries such as apparel and footwear, which provide livelihoods for millions of low-skilled workers.<\/li>\n<li><strong>The stagnation in manufacturing<\/strong>, which continues to remain at around 14% of GDP (well below the target of 25%), has exacerbated the <strong>divide between high-skilled and low-skilled jobs.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li><strong>Decline in export-related jobs:<\/strong>\n<ul>\n<li>According to a World Bank report, the export-related jobs in India have been <strong>declining <\/strong>over the past decade.<\/li>\n<li>This is due to the <strong>dominance of the service sector and high-skill manufacturing <\/strong>in India\u2019s export basket.<\/li>\n<li>Since these sectors are <strong>less suited to absorbing large portions of the Indian workforce <\/strong>(India\u2019s services exports constitute 4.3%, while goods exports 1.8% of the world\u2019s), job creation due to trade has diminished.<\/li>\n<\/ul>\n<\/li>\n<li><strong>High tariffs on input materials:<\/strong>\n<ul>\n<li>Since 2017, India appears to have reversed the tariff reductions initiated in the early 1990s.<\/li>\n<li>As per the WTO Tariff Profile for 2022, India\u2019s average Most Favoured Nation (MFN) tariff increased to 18.1%, from 17.6% in 2019 and 13.4% in 2016.<\/li>\n<li>High import tariffs on key intermediate inputs have <strong>raised production costs, making Indian producers less competitive in international markets<\/strong>.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Declining participation in Global Value Chains (GVCs):<\/strong>\n<ul>\n<li>The Indian exporters with GVC linkages demonstrate stronger export performance and greater diversification in products and markets compared to those without such connections.<\/li>\n<li>However, India\u2019s participation in GVCs has been declining due to issues such as <strong>difficulties in procuring raw materials and high transport costs.<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><strong>Why are These Trends in the Job Sector Concerning?<\/strong><\/h2>\n<ul>\n<li><strong>High national unemployment rate:<\/strong>\n<ul>\n<li>According to the Economic Survey 2023-24, India needs to <strong>create nearly 7.85 million jobs annually in the non-farm sector<\/strong> to accommodate the growing workforce.<\/li>\n<li>However, the national unemployment rate surged from <strong>7 to 9% in June 2024<\/strong> (as per the CMIE data).<\/li>\n<\/ul>\n<\/li>\n<li><strong>India has been unable to capitalise on the opportunity presented by China:<\/strong>\n<ul>\n<li>Between 2015 and 2022, China\u2019s participation in low-skill manufacturing of apparel, leather, textiles and footwear has decreased.<\/li>\n<li>Countries such as Bangladesh, Vietnam, Germany and the Netherlands (<strong>not India<\/strong>) have become the primary beneficiaries of China\u2019s shrinking market share.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><strong>Way Ahead to Boost Jobs in India (Particularly in the Labour-Intensive Sectors):<\/strong><\/h2>\n<ul>\n<li><strong>Steps taken boost scale in the Indian textile sector:<\/strong>\n<ul>\n<li><strong>PM Mega Integrated Textile Region and Apparel (PM MITRA) Parks:<\/strong> In 2023, the Centre had approved the setting up of <strong>7 <\/strong>PM MITRA parks to develop world-class infrastructure with an outlay of Rs 4,445 crore for a period up to 2027-28.<\/li>\n<li><strong>National Industrial Corridor Development Programme (NICDP):<\/strong> The Cabinet Committee on Economic Affairs recently approved setting up of 12 industrial smart cities under the NICDP with an estimated investment of Rs 28,602 crore.<\/li>\n<li><strong>Reducing tariffs and simplifying procedures: <\/strong>In the FY25 Union Budget, the government announced tariff reductions on various items, including medical equipment, critical minerals, solar energy products, leather and textiles, etc.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Rise in Global Capability Centres (GCCs):<\/strong>\n<ul>\n<li>Even as manufacturing in traditionally high-labour-intensive sectors has slowed, <strong>India has emerged as a key market for MNCs to establish data analytics and software development centres.<\/strong><\/li>\n<li>Known as GCCs, these centres have proliferated in India, leveraging the large pool of qualified IT engineers in the country.<\/li>\n<li>With close to 1,600 GCCs from MNCs across various sectors, India has become to the world what China is for tech hardware.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<hr \/>\n<h3><strong>Q.1. What issues India&#8217;s job market is facing?<\/strong><\/h3>\n<p>With around 40% of India&#8217;s 1.4 billion citizens under 25 years old and with millions of India&#8217;s youths entering the job market every year, clear skill mismatches and a lack of suitable job creation for young Indians remain the biggest labour-market challenges.<\/p>\n<h3><strong>Q.2. What is the Pradhan Mantri Kaushal Vikas Yojana (PMKVY)?<\/strong><\/h3>\n<p>The PMKVY scheme is for imparting skill development training through Short-Term Training (STT) and Up-skilling and Re-skilling through Recognition of Prior Learning (RPL) to youth across the country including rural areas.<\/p>\n<p><strong>Source: <\/strong><a href=\"https:\/\/indianexpress.com\/article\/business\/economy\/low-high-skilled-jobs-gap-rising-as-manufacturing-stagnation-continues-9569727\/\" target=\"_blank\" rel=\"nofollow noopener\">Low- &amp; high-skilled jobs: Gap rising as manufacturing stagnation continues<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The stagnation in manufacturing has exacerbated the divide between high-skilled and low-skilled jobs in India<\/p>\n","protected":false},"author":5,"featured_media":42486,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[],"class_list":{"0":"post-42485","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/42485","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=42485"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/42485\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/42486"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=42485"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=42485"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=42485"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}