The Union Labour Ministry on Monday rebutted Citigroup’s recent Research report, which claimed that India will struggle to create enough jobs for its growing workforce over the next decade, even with a rapid economic growth rate of 7 per cent.

Noting that the Citigroup research report does not “analyse all official data sources available in the public domain”, the Labour Ministry said that this report fails to consider the positive trends and comprehensive data from official sources.

Labour Ministry highlighted that it has generated over 8 crore job opportunities between 2017-18 to 2021-22, contradicting Citigroup’s assertion of a potential gap in employment in India. 

The Labour Ministry highlighted that the said report fails to account for the comprehensive and positive employment data available from official sources such as the Periodic Labour Force Survey (PLFS) and RBI’s KLEMS data.

RBI’s KLEMS data

“According to PLFS and RBI’s KLEMS data, India has generated more than 8 crore (80 million) employment opportunities from 2017-18 to 2021-22. This translates to an average of over 2 crore (20 million) employment per year, despite of the fact that the world economy was hit by Covid-19 pandemic during 2020-21 which contradicts Citigroup’s assertion of India’s inability to generate sufficient employment. This significant employment creation demonstrates the effectiveness of various government initiatives aimed at boosting employment across sectors,” an official release said.

Raising concerns over pace of job creation in India, Citigroup had in its research report estimated that the country will need to create about 12 million jobs a year over the next decade to absorb the number of new entrants in the labour market.

On a GDP growth rate of 7 per cent, India can only generate 8-9 million jobs a year, the bank’s economists Samiran Chakraborty and Baqar Zaidi wrote in a report last week. 

Several shortcomings

Meanwhile Labour Ministry in its statement said that private data sources cited by the Citigroup report have several shortcomings, including non-standard definitions of employment and less robust sampling methodologies compared to official data sources like PLFS.

Also some authors use data selectively which undermines the credibility of their analysis and does not present an accurate picture of the employment scenario in India, Labour Ministry added.

The Government remains committed to creating a robust and inclusive job market, it added.

The Labour Ministry said that more than 6.2 crore net subscribers joined Employees Provident Fund Organisation (EPFO) between September 2017 to March 2024. During 2023-24, more than 1.3 crore subscribers joined EPFO which is more than double compared to 61.12 lakh joined EPFO during 2018-19, it added.

NPS data

Also the data from National Pension System (NPS) indicates that more than 7.75 lakh new subscribers have joined the NPS during 2023-24 under the central and state governments which is 30 perc ent more than 5.94 lakh new subscribers joining NPS under government sector during 2022-23.

Labour Ministry said that the official data sources like PLFS, RBI, EPFO, etc. show consistent improvements in the key labour market indicators, including increased Labour Force Participation Rate (LFPR) and Worker Population Ratio (WPR), and a declining Unemployment Rate during last five years. 

EPFO and NPS data further support the positive employment trends. The trends in manufacturing, expanding service sector, infrastructure growth, apart from others, including emerging opportunities in multiple sectors such as gig and platform economy and GCCs indicate robust future prospects, Labour Ministry added.

The Labour Ministry emphasised the credibility and comprehensiveness of official data, cautioning against the selective use of private data sources that can lead to misleading conclusions about India’s employment scenario.