ET Budget Survey: 50% say unemployment is top challenge for India

India has set eyes to become the third largest economy by 2030 while its Viksit Bharat vision is to make the country a developed nation by 2047. However, unemployment continues to be a major headache for the country even as it grew 8.2 per cent in FY24 and has managed to grow at an average of 8 per cent in the last three years. In an ET Online survey, over 50 per cent of respondents believe unemployment is the top challenge for the Indian economy.

In the run-up to the Budget 2024, ET Online conducted a survey to get a sense of what India is looking for in the upcoming Union Budget. The survey received responses from nearly 9,500 Economic Times readers.

The findings show that unemployment emerged as the most significant issue, with 51.8% of participants identifying it as the top challenge for the country. Over 24% of respondents believe inequality as a major concern. Rural infrastructure was highlighted by 16.3% of the respondents, while the fight against climate change was seen as the primary issue by 7.6%.

India added 4.7 crore new jobs in the fiscal year 2023-24, that turns out to be 38 lakh jobs per month, according to RBI’s KLEMS data.According to an International Labour Organisation report, more than 80 per cent of India’s unemployed workforce comprises its youth. A Citi report on India’s unemployment stated that the country will struggle to create sufficient employment opportunities even with a 7 per cent growth rate.

When asked about the quickest way to transform India into a developed economy, 33.3% of respondents opted for improving workforce skills, closely followed by a focus on inclusive growth at 33.2%. Faster job creation was seen as crucial by 26.3% of participants, while 7.2% believed that increased government spending would be the key.

Industry groups are also advocating for job-linked incentives in the upcoming budget.

“A job-linked vocational education scheme which seeks to train manpower to meet the current and future demands of the industry will provide the much-needed impetus,” Rohin Kapoor, Partner, Education & Skilling, Management Management Consulting, BDO India had told ET Online.

Kapoor pointed out lack of world class training infrastructure facilities, no guarantee of jobs post completion of programs, limited industry and academia dialogue & connect, shortage of trainers to meet the massive demand, poor monitoring and supervision of training centres as some of the reasons why India failed to have strong skilled workforce despite schemes in place.

Regarding budgetary measures to tackle India’s unemployment problem, 54.1% of survey respondents recommended incentivising private job creators. Setting up more MSME units was favored by 32.2%, while creating more government jobs and offering more and cheaper Mudra loans were suggested by 9.5% and 4.3% of respondents, respectively.