Aim and shoot

Aim and shoot

Creating a reliable employment database is essential for effective jobs policy.
Reliable data is a pre-requisite for effective policy making.
Remove this condition, it will be tantamount to a doctor prescribing medicines in the absence of adequate diagnostics.It is in this context that the Narendra Modi government's decision this week to create a task force on jobs data under Niti Aayog vice chairman Arvind Panagariya should be seen. The task force will suggest ways to improve the quality of data. Job creation is the most important measure of the efficacy of economic policy in India. The task force's recommendations therefore will be key to improving the quality of policy making.
Two problems beset data generation in India. Robust data on a key area such as employment is generated once in five years by the National Sample Survey Organisation, which leaves policy makers at a disadvantage for long periods. On the other side of the spectrum, high frequency data such as the monthly index of industrial production is unreliable. Consequently, users resort to proxies or the government comes up with unsatisfactory alternatives. For instance, the quarterly employment survey by the labour bureau is based on just eight sectors of the economy.
As we wait for the task force's suggestions and subsequent changes, there is much work to be done on the policy side. The 2011-12 NSSO survey on employment showed that India's unemployment rate was 2.2%, lower than most advanced economies. However, the survey doesn't really bring out the dismal employment scenario in terms of quality of jobs. A large section of India's working population is stuck in low paying, informal jobs with limited opportunities of mobility. This dimension of India's jobs landscape must be tackled immediately. Policy should look at both immediate results and long term measures.
The Modi government's initial emphasis on ease of doing business is flagging and needs to be pursued with more vigour. India is overregulated in the wrong areas, which discourages new entrants. The economy loses out on jobs on account of red tape. Eliminating needless regulatory hurdles must be complemented with greater emphasis on appropriate education. Skilled and adaptable workers are the ones most likely to find work. The failure to create jobs has manifested itself in new and more violent agitations for reservation. There is no time to lose.