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Bihar Naman Publishing House: (WWW - Biharnaman.in)
Bihar Naman Publishing House: (WWW - Biharnaman.in)
in)
While the unemployment rate in the state averaged 46% during April and May 2020,
the peak months of the lockdown, the all-India unemployment rate in the same period
was 24%. Though the unemployment rate in the state has since then come down to
12%, it is much higher than the all-India estimate of 6.7% at the same time.”
Table of Contents
1. Unemployment…?
2. Measurement of Unemployment in India
3. Types of Unemployment in India
4. Unemployment Trap and Harmonized Unemployment
5. Measurement of Unemployment in India
6. Alarming situation in India..?
7. Unemployment Status in BIHAR
8. Causes of Unemployment in BIHAR
9. Impact of Unemployment in Bihar
10. Way Forward
11. Schemes of Govt. of Bihar to enable the better
Employability in Bihar
Unemployment is often used as a measure of the health of the economy. The most
frequent measure of unemployment is the unemployment rate, which is the number of
unemployed people divided by the number of people in the labor force.
Unemployment rate = (Unemployed Workers / Total labor force) × 100
(1) The employment rate in Bihar was 33.8 per cent in September 2020, which means
that only one in three adult Biharis is employed.
(2) Data from the National Sample Survey showed that Bihar’s unemployment rate rose
in 2018-19 to 10.2 per cent, as against 7.2 per cent in the year-ago period. At the same
time, the overall unemployment rate for the entire country fell to 5.8 per cent from 6.1
per cent the year before.
But more worryingly, the data showed that Bihar had one of the highest
unemployment rates in the age-group of 15-29 years — 30.9 per cent in 2018-19, as
against 22.8 per cent in the year-ago period. This data point could have worsened in
subsequent years.
25 22.8
20 Overall Unemployment
15
10.2 Unemployment in age group of 15-
10 7.2 29
0
2018-19 2017-18
(3). After the lockdown brought high-scale economic disturbances during April and May
2020, the unemployment rate in Bihar shot up to 46 per cent, while the all-India
unemployment rate in the same period was 24 per cent, according to the Centre for
Monitoring Indian Economy (CMIE). With a gradual easing in restrictions, the
unemployment rate in Bihar dropped to 12 per cent, but, even this is much higher than the
all-India estimate of 6.7 per cent at the same time.
(4) Bihar’s unemployment rate is higher than the all-India average. According to the
2018-19 Periodic Labor Force Survey (PLFS), the official source of employment
(5) Only 10% of jobs in Bihar are salaried jobs. According to the 2018-19, PLFS, 23.8%
of India’s workers had a salaried job. This number was just 10.4% for Bihar. In 2011-12
people of Bihar with salaried job was 5.8 per cent, 13.1 per cent in 2017-18 and declined
to 10.4 per cent in 2018-19. In 2004-05, nationally 14.3 per cent people in the country
were salaried, 17.9 per cent in 2011-12, 22.8 per cent in 2017-18 and 23.8 per cent in
2018-19.
(6) The status of employment for women was also a concern. The worker population
ratio, which denotes how many people in a given population set are employed, was just
3.9% for rural women in Bihar against the national average of 24.6%. Put simply, this
meant that at all-India level, nearly every fourth rural woman was employed but in Bihar
only about 4 in every 100 rural women found a job.
(7) The worker population ratio (WPR) for male workers in rural Bihar was 64%, about
8 percentage points lower than the all-India average. The WPR for female workers was
abysmally low at 3.9% in rural Bihar. In 2017-18, 55.9% males were self-employed and
the share of casual labor at 32.1% was significantly higher than the all-India level
(24.3%).
(8) Fewer young people – yet fewer jobs. Although Bihar has one of the lowest
proportion of young people, unemployment for them (15- to-29 age group) is higher at
17.5% than the national average of 13%. The unemployment rate for those above 30 is
1.4%, according to labor data, the same as the national average.
(9)As in other parts of the country, educated and qualified youngsters are more
unemployed in Bihar than youth who are illiterate or with low education.
(10) Most of Bihar’s youth are engaged in agriculture, followed by construction and trade.
(1) Less number of industries- To curb the chaos created by the Corona Virus crisis,
Indian states are formulating their strategies to open doors for various companies
and to attract foreign investments. But, Bihar has a low share of factories in the
country. The table provides a tally of number of factories as compared to allover
India.
2004-05 2017-18
250000
237684
200000
150000
136353
100000
50000
0 1675 3461
Bihar All India
Number of Factories
250000 2,37,684 2004-05
2017-18
200000
150000 1,36,353
100000
50000
1675 3461
0
Bihar All- India
On the other hand, Bihar as a state is way behind among other regions including
Jharkhand, which bagged fifth position in ease of doing business ranking 2019. “Due to
corruption, lack of infrastructure, lack of administrative reforms, law and order problems,
and lack of political will has made setting of enterprises in Bihar a tough turf. Its rank is
26 out of 36 states and UTs (2019), and even the neighboring state Jharkhand is ahead of
us,” exclaims Prof. Kumar.
Suggesting the future course of action, Dr Singh proclaims, “Bihar lags in the
ranking for State Investment Potential Index (2018) and State Competitiveness Index
(2017), amongst other rankings of Indian states. To make the state more competitive and
investment friendly, the public investment in the transport sector in Bihar which has
almost tripled from FY13 to FY20, needs to be enhanced. Currently, it is far below the
national average in terms of length of national highways and railway tracks.”
(2)Poverty and low per capita income- Due to poverty, students lacks good and quality
education which further leads to unemployment. Due to unemployment poverty rises, so
it creates vicious cycle. In 2011-12, Bihar remained one of the poorest states in the
country, with 33.7 per cent of its population below the poverty line. Economists and
analysts say though there may have been some improvements in the subsequent years,
demonetisation and now the Covid-19 pandemic may have pushed more people below the
poverty line. Shaibal Gupta, founder member secretary of the Asian Development
Research Institute (ADRI) in Patna, said demonetisation was like a “monetary Covid”
that may have increased poverty levels in the state.
Care Ratings, in a 30 October report, estimated that the per capita GSDP of Bihar was
at Rs 46,664 in 2019-20, only 35 per cent of the national average of Rs 1,34,226. In
2011-12, its per capita GSDP was at 34 per cent of the national average, reflecting
negligible improvement, despite the fact that the state’s economy grew at a faster pace
than the overall Indian economy.
15
12.3 13.6 14.8 15
10
8.2 8.4
5
0
2013-14 2014
2014-15 2015-16
2016-17
2017-18
2018-19
“Bihar remains one of the most populous states with the lowest per capita income. A lot
needs to be done to lift the economy to a higher level,” the report said.
“In the case of Bihar, the public investment accounts for a major part of
the total investment and this component will decrease substantially in
2020-21, as state finances will be much stressed due to the crisis. The
resulting negative overall growth rate of Bihar economy under
reasonable assumptions will be approximately between minus 15.0 to
18.2 per cent,” revealed the Asian Development Research Institute
(ADRI) report.
(1) Migration to other states- when it comes to migration, Bihar tops the country with
the highest percentage of migration taking place every year. According to 2011
census, 32.3 per cent people in Bihar migrated to other parts of the country for job
and employment followed by Odisha at 31.5 per cent.
(2) The problem of unemployment gives rise to the problem of poverty in Bihar.
(3) Young people after a long time of unemployment indulge in illegal and wrong
activities for earning money. This also leads to increase in crime in the country.
(4) Unemployed persons can easily be enticed by antisocial elements. This makes
them lose faith in democratic values of the country.
(5) It is often seen that unemployed people end up getting addicted to drugs and
alcohol or attempts suicide, leading losses to the human resources of the country.
Way Forward
(1)Challenges and steps need to be taken in the revival of local economy
The state does not have major fund access due to lack of industries and is primarily
dependent on government funds. In such circumstances, responsibility for reviving
sectors rests majorly on the shoulder of state government. This has been further explained
in the ADRI report. It states that Bihar has been heavily dependent on central transfers
and grants for resources, which was 77.6 per cent in the year 2018-19. This significant
reduction in the revenue collection of the central government will affect the state finances
badly. Hence, Bihar needs to explore the possibility to generate more revenue from its
own sources. It was noted that growth of the state depends heavily on increasing fiscal
capacity of the state government. This indicates that the state government and sectors
have a bigger role in reviving the economy.
The table also indicates there is a lot of scope of improvement, as the share in total output
is still lower when compared to the demographics. But, the fact that they have been
increasing yield per hectare bears testimony to efforts they have put in. It also shows the
natural advantage of fertile land of this region which are fed by rivers. Here is another
table indicating a comparison with the national average.
As per the analysis of CARE Ratings, productivity in Bihar is higher in coarse cereals,
pulses, and sugarcane compared with all India average which is very encouraging.
However, a lot of this has been achieved by very high use of fertilizers which is 70 per
cent more than the national average. In case of Bihar, it is 227.3 kg per hectare against
13 Bihar Naman Publishing House (www.biharnaman.in)
the national average of 133.1 kg per hectare in 2018 2018-19. Adding his views, Dr. Singh
claims that agriculture sector can be game changer for the upheaval of Bihar economy.
He claims, “We also believe that the agriculture reforms announced by the government
will help farmers to access markets, realise better price for their products, encourage
investments, and more importantly bring about standardization in quality for exports. The
agriculture
ture sector of Bihar is likely to receive a boost through this.”
800 634
600
362
400
India
200 15 34
0
2006
2006-07 2015-16
Overalll Bihar stands at number 8th when it comes to medium and smallsmall-scale
scale industries.
Out of 5.4 per cent of the MSMEs, Bihar employs nearly 5 per cent of the total employed
under this classification. However, the share of total investments under this classification
classific
is low at 1.3 per cent which saw a decline of 1.8 per cent in 2006
2006-07.
Professor Kumar says that Bihar will be benefitted if the state focuses on
manufacturing and setting up more micro units. According to him, the MSME sector will
give some respite from the bigger issues related to unemployment. “As per the latest data
there are 8.23 lakhs MSME units in Bihar. Out of which 8.05 lakhs are micro enterprises,
0.17 lakhs is small, and 0.16 lakhs is medium enterprises. It means major chunk in
MSME sector is of micro-enterprises.
enterprises. This sector can hence become a growth engine of
Bihar,” he suggests.
Overall, a lot needs to be done to revitalize the economy of Bihar as it is one of the most
populous states with lowest per capita income. Agriculture being one of its strength, the
increased production can contribute in the fair shares of GSDP. It is currently higher than
the national average. The state government also needs to improve rank in doing business
to generate investments.
The Care Ratings report also pointed out that Bihar has a low share of India’s factories —
only 1.5 per cent as of 2017-18 — and will need to improve.
“This is a fallout of the lower share of manufacturing in GSDP, given that manufacturing
has the potential of attracting higher investment, which in turn generates more
employment… The government needs to focus on providing the right incentives to enable
the same,” the report said.
(5) Public investment in sectors like health, education, police and judiciary can
create many government jobs.
The State Government has launched special schemes/ programs/ policies to enable the
youth of Bihar become self-reliant by improving their competency through creating
opportunities for education and skill development and better employability. These
schemes include -
1. Bihar Student Credit Card Scheme.
2. Mukhyamantri Nishchay Swayam Sahayata Bhatta Yojana.
3. Bihar Start Up Policy.
4. Kushal Yuva Program Skill Training Scheme.
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