Getting laid off is traumatic. I have been laid off twice in the last 16 years. The last time it happened, I managed to get a new job within a week’s time. The severance package I received was enough to make an upfront payment to buy a modest house.
So within weeks of losing a job that I loved, I was employed with a new company, and I had a house of my own. The downside was that I had to work for an employer I'd rather not have associated with if I had had a choice. However, I admit that not everyone of my ilk was as fortunate.
Layoffs Followed by Strong Recovery in 2009
But that was in 2009. Global headwinds had taken a toll on our economy. The setback was temporary as our domestic fundamentals at the time were healthy. Other than persistently high inflation, most other macro indicators were strong enough to weather external shocks. This is why recovery was swift. Barring a few sectors, companies began hiring the moment the clouds of uncertainty cleared.
According to the government’s labour bureau data, eight sectors – textiles, leather, metals, automobiles, gems and jewellery, transport, IT/BPO and handloom – added in excess of one million jobs in the two quarters beginning July 2009. Incidentally, the process of collecting quarterly employment data began in January 2009 “to study the impact of global economic slowdown.”
Other than occasional spurts, the buoyancy witnessed in the second half of 2009 has unfortunately been missing since then. In the last 14 quarters starting January 2012, the quarterly run rate has never crossed the 2 lakh job addition mark.
In fact, in the last 10 quarters (April-June 2013 to July-September 2015) for which data is available, these eight sectors added only 9.74 lakh jobs according to government data! This is happening at a time when close to one million job aspirants in the country join the workforce every month.
No wonder former Infosys HR head Mohandas Pai recently told the BloombergQuint that “when you sit down in 2030 and write the history of India from 2010 to 2030, we will see that this is the forgotten, lost generation of India.”
“The Lost Generation” Has No Jobs in the Season of Retrenchment
There are opportunities outside of these eight sectors. But the movement in these sectors does show a trend of what is happening in the broader economy – and what it shows is a gloomy employment scenario in the country.
In this backdrop, reports of pink slips being given (the latest being of Snapdeal) are scary. Even more horrifying are reports that suggest that erstwhile job-creating sectors like telecom, information technology (IT) and banking and financial services (BFSI) are going to shed more than 1.5 lakh jobs in the next few months.
E-commerce companies are already bleeding and taxi hailing firms like Ola and Uber are going through a kind of turmoil never seen before.
Reports also suggest that the buoyancy witnessed in the start-up ecosystem is petering out. These are the sectors that have provided quality jobs in the last few months. If they are shedding employees, which sectors are adding? With the demonetisation decision almost killing the job-churning MSME sector, shouldn’t this be a cause for huge concern?
While political parties seem oblivious to the scary scenario of growing joblessness, make no mistake, repercussions are bound to follow. Movements by the Marathas in Maharashtra, Patidars in Gujarat and Jats in Haryana are some of the early signs of things to come.
Urban Constituency is Significant Enough to Impact Elections
The accelerated economic growth witnessed during the first term of the Congress-led United Progressive Alliance (UPA) government helped the Congress and its allies make handsome gains in these constituencies in the 2009 Lok Sabha elections.
Most commentators tend to think it is thanks to rural-oriented schemes like the Mahatma Gandhi National Employment Guarantee Scheme (MNREGS) that the UPA returned to power in 2009.
Closer analysis, however, shows that the UPA busted all myths by grabbing a majority of urban seats – 115 out of the total of 201 seats in the last Lok Sabha elections. That was largely because of the feel-good factor accompanying years of very high growth.
As growth faltered and job creation slowed considerably in subsequent years, the goodwill enjoyed began to slide rather rapidly.
An analysis of elections to urban bodies between 2009 to 2102 shows that the Congress’ fortunes began to wane even before the 2014 Lok Sabha elections. The party could win only 22 percent of all urban local body seats during that period. That was quite a change from a healthy strike rate of 60 percent in the 2009 elections.
So, here is a warning to all those who are unable to make use of the country’s demographic dividend: The “lost generation” will extract its pound of flesh, and the accompanying political churn could unsettle many existing notions.
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