NEW DELHI (AP) — As India’s economy grew, the hum of factories turned the sleepy, dusty village of Manesar into a booming industrial hub, cranking out everything from cars and sinks to smartphones and tablets. But jobs have run scarce over the years, prompting more and more workers to line up along the road for work, desperate to earn money.
Every day, Sugna, a young woman in her early 20s who goes by her first name, comes with her husband and two children to the city’s labor chowk — a bazaar at the junction of four roads where hundreds of workers gather daily at daybreak to plead for work. It’s been days since she or her husband got work and she has only five rupees (six cents) in hand.
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Scenes like this are an everyday reality for millions of Indians, the most visible signs of economic distress in a country where raging unemployment is worsening insecurity and inequality between the rich and poor. It’s perhaps Prime Minister Narendra Modi’s biggest challenge as the country marks 75 years of independence from British rule on Monday.
“We get work only once or twice a week,” said Sugna, who says she earned barely 2,000 rupees ($25) in the past five months. “What should I do with a life like this? If I live like this, how will my children live any better?”
Entire families leave their homes in India’s vast rural hinterlands to camp at such bazaars, found in nearly every city. Out of the many gathered in Manesar recently, only a lucky few got work for the day — digging roads, laying bricks and sweeping up trash for meager pay — about 80% of Indian workers toil in informal jobs including many who are self-employed.
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India’s phenomenal transformation from an impoverished nation in 1947 into an emerging global power whose $3 trillion economy is Asia’s third largest has turned it into a major exporter of things like software and vaccines. Millions have escaped poverty into a growing, aspirational middle class as its high-skilled sectors have soared.
“It’s extraordinary — a poor country like India wasn’t expected to succeed in such sectors,” said Nimish Adhia, an economics professor at Manhattanville College.
This year, the economy is forecast to expand at a 7.4% annual pace, according to the International Monetary Fund, making it one of the world’s fastest growing.
But even as India’s economy swells, so has joblessness. The unemployment rate remains at 7% to 8% in recent months. Only 40% of working age Indians are employed, down from 46% five years ago, the Center for Monitoring the Indian Economy (CMIE) says.
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“If you look at a poor person in 1947 and a poor person now, they are far more privileged today. However if you look at it between the haves and the have nots, that chasm has grown,” said Gayathri Vasudevan, chairperson of LabourNet, a social enterprise.
“While India continues to grow well, that growth is not generating enough jobs – crucially, it is not creating enough good quality jobs,” said Mahesh Vyas, chief executive at CMIE. Only 20% of jobs in India are in the formal sector, with regular wages and security, while most others are precarious and low-quality with few to no benefits.
That’s partly because agriculture remains the mainstay, with about 40% of workers engaged in farming.
As workers lost jobs in cities during the pandemic, many flocked back to farms, pushing up the numbers. “This didn’t necessarily improve productivity – but you’re employed as a farmer. It’s disguised unemployment,” Vyas said.
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With independence from Britain in 1947, the country’s leaders faced a formidable task: GDP was a mere 3% of the world’s total, literacy rates stood at 14% and the average life expectancy was 32 years, said Adhia.
By the most recent measures, literacy stands at 74% and life expectancy at 70 years. Dramatic progress came with historic reforms in the 1990s that swept away decades of socialist control over the economy and spurred remarkable growth.
The past few decades inspired comparisons to China as foreign investment poured in, exports thrived and new industries — like information technology – were born. But India, a latecomer to offshoring by Western multinationals, is struggling to create mass employment through manufacturing. And it faces new challenges in plotting a way forward.
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Financing has tended to flow into profitable, capital intensive sectors like petrol, metal and chemicals. Industries employing large numbers of workers, like textiles and leather work, have faltered. This trend continued through the pandemic: despite Modi’s 2014 ‘Make in India’ pitch to turn the country into another factory floor for the world, manufacturing now employs around 30 million. In 2017, it employed 50 million, according to CMIE data.
As factory and private sector employment shrink, young jobseekers increasingly are targeting government jobs, coveted for their security, prestige and benefits.
Some, like 21-year-old Sahil Rajput, view such work as a way out of poverty. Rajput has been fervently preparing for a job in the army, working in a low-paid data-entry job to afford private coaching to become a soldier and support his unemployed parents.
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But in June, the government overhauled military recruitment to cut costs and modernize, changing long-term postings into four-year contracts after which only 25% of recruits will be retained. That move triggered weeks of protests, with young people setting vehicles on fire.
Rajput knows he might not be able to get a permanent army job. “But I have no other options,” he said. “How can I dream of a future when my present is in tatters?”
The government is banking on technology, a rare bright spot, to create new jobs and opportunities. Two decades ago, India became an outsourcing powerhouse as companies and call centers boomed. An explosion of start-ups and digital innovation aims to recreate that success – “India is now home to 75,000 startups in the 75th year of independence and this is only the beginning,” Minister of Commerce, Piyush Goyal, tweeted recently. More than 740,000 jobs have been created via start-ups, a 110% jump over the last six years, his ministry said.
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There’s still a long way to go, in educating and training a labor force qualified for such work. Another worry is the steady retreat of working women in India — from a high of nearly 27% in 2005 to just over 20% in 2021, according to World Bank data.
Meanwhile, the stopgap of farming appears increasingly precarious as climate change brings extreme temperatures, scorching crops.
Sajan Arora, a 28-year-old farmer in India’s breadbasket state of Punjab, can no longer depend on ancestral farmland his family has relied on to survive. He, his wife and seven-month old daughter, plan to join family in Britain and find work there after selling some land.
“Agriculture has no way forward,” said Arora, saying he will do whatever work he can get, driving a taxi, working in a store or on a construction site.
He’s sad to leave his parents and childhood home behind, but believes the uncertainty of change offers “better prospects” than his current reality.
“If everything was right and well, why would we go? If we want a better life, we will have to leave,” he said.
Climate inaction will depress the world’s economy more than previously estimated, according to a new study that takes into account the impacts of weather extremes and variability such as temperature spikes and intense rainfall.
A scenario in which global temperatures rise 3C on average will reduce the world’s gross domestic product by about 10%, doctoral researcher Paul Waidelich of ETH Zurich and colleagues write, with less developed countries paying the worst toll. By comparison, limiting global warming by 2050 to 1.5C — as sought by the Paris Agreement — will reduce that impact by about two-thirds.
Climate change is on track to cost the global economy $38 trillion a year in damages within the next 25 years, researchers warned on Wednesday, a baseline that underscores the mounting economic costs of climate change and continued inaction as nations bicker over who will pick up the tab.
Key Facts
Damages from climate change will set the global economy back an estimated $38 trillion a year by 2049, with a likely range of between $19 trillion and $59 trillion, warned a trio of researchers from Potsdam and Berlin in Germany in a peer reviewed study published in the journal Nature.
To obtain the figure, researchers analyzed data on how climate change impacted the economy in more than 1,600 regions around the world over the past 40 years, using this to build a model to project future damages compared to a baseline world economy where there are no damages from human-driven climate change.
The model primarily considers the climate damages stemming from changes in temperature and rainfall, the researchers said, with first author Maximilian Kotz, a researcher at the Potsdam Institute for Climate Impact Research, noting these can impact numerous areas relevant to economic growth like “agricultural yields, labor productivity or infrastructure.”
Importantly, as the model only factored in data from previous emissions, these costs can be considered something of a floor and the researchers noted the world economy is already “committed to an income reduction of 19% within the next 26 years,” regardless of what society now does to address the climate crisis.
Global costs are likely to rise even further once other costly extremes like weather disasters, storms and wildfires that are exacerbated by climate change are considered, Kotz said.
The researchers said their findings underscore the need for swift and drastic action to mitigate climate change and avoid even higher costs in the future, stressing that a failure to adapt could lead to average global economic losses as high as 60% by 2100.
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How Do The Costs Of Inaction Compare To Taking Action?
Cost is a major sticking point when it comes to concrete action on climate change and money has become a key lever in making climate a “culture war” issue. The costs and logistics involved in transitioning towards a greener, more sustainable economy and moving to net zero are immense and there are significant vested interests such as the fossil fuel industry, which is keen to retain as much of the profitable status quo for as long as possible. The researchers acknowledged the sizable costs of adapting to climate change but said inaction comes with a cost as well. The damages estimated already dwarf the costs associated with the money needed to keep climate change in line with the limits set out in the 2015 Paris Climate Agreement, the researchers said, referencing the globally agreed upon goalpost set to minimize damage and slash emissions. The $38 trillion estimate for damages is already six times the $6 trillion thought needed to meet that threshold, the researchers said.
Crucial Quote
“We find damages almost everywhere, but countries in the tropics will suffer the most because they are already warmer,” said study author Anders Levermann. The researcher, also of the Potsdam Institute, explained there is a “considerable inequity of climate impacts” around the world and that “further temperature increases will therefore be most harmful” in tropical countries. “The countries least responsible for climate change” are expected to suffer greater losses, Levermann added, and they are “also the ones with the least resources to adapt to its impacts.”
What To Watch For
The fundamental inequality over who is impacted most by climate change and who has benefited most from the polluting practices responsible for the climate crisis—who also have more resources to mitigate future damages—has become one of the most difficult political sticking points when it comes to negotiating global action to reduce emissions. Less affluent countries bearing the brunt of climate change argue wealthy nations like the U.S. and Western Europe have already reaped the benefits from fossil fuels and should pay more to cover the losses and damages poorer countries face, as well as to help them with the costs of adapting to greener sources of energy. Other countries, notably big polluters India and China, stymie negotiations by arguing they should have longer to wean themselves off of fossil fuels as their emissions actually pale in comparison to those of more developed countries when considered in historical context and on a per capita basis. Climate financing is expected to be key to upcoming negotiations at the United Nations’s next climate summit in November. The COP29 summit will be held in Baku, the capital city of oil-rich Azerbaijan.
