J&K’s latest unemployment data is worrisome. Situation demands effective policy measures.

The latest data from J&K’s Employment Department about the state of joblessness is worrisome. This situation of joblessness among a large educated workforce in a state like J&K has several macroeconomic, social and human development implications.

From a macroeconomic perspective, the unemployment rate of 23%, as reported in April 2023 by CMIE, is significantly higher than the national average. With a total population of 1.3 crore and a workforce of about 80 lakhs, there seems to be a significant gap between the available workforce and employment opportunities. This indicates a mismatch between the supply and demand of jobs in J&k today, leading to this kind of high unemployment rate. This situation demands a systematic and long term macro-economic policy planning. It cannot be addressed through annual budget planning or the annual development planning processes at district levels alone.

The Employment Department’s data suggests that there are 6,63,511 unemployed youth in Jammu and Kashmir as of May, 2022. This is a colossal number for a region which has heavily relied on the government sector for jobs, and where the private sector is largely struggling. The number of unemployed educated individuals registered at the departmental portal indicates the depth of lack of suitable job opportunities for the educated workforce, leading to underutilization of their skills and knowledge. The exclusion of such a large workforce from the economic system risks creation of a vicious cycle of its own – lower consumption, lower productivity and even lower number of jobs. From a human development perspective, this degree of unemployment can hinder J&K’s human development ambitions too. This high youth unemployment can also lead to more instances of dissatisfaction, and increased inequality, which can affect the overall social fabric of entire Jammu & Kashmir.

We are already seeing telltale signs of poverty in Jammu & Kashmir, including among the once-thriving middle class. There is considerable anecdotal evidence available suggesting that many people’s access to quality education, healthcare, nutritious and balanced food, especially in J&K’s urban centres, is not as good as it used to be.

While successive governments in J&K, including the present administration, have taken a slew of measures to promote private sector investment, industries and job creation, the fact is that the scale of that investment and the corresponding job creation do not meet J&K’s current demographic needs, especially of its young population. J&K is known to have some inherent industrial and business disadvantages which are unlikely to go away overnight. While significant incentives and support have been provided by governments to local businesses, startups, and small and medium enterprises (SMEs) in recent years, all that is not translating into a corresponding job creation.

To address this complex joblessness situation in Jammu and Kashmir, a multi-faceted approach is needed, combining macroeconomic policies, social interventions and human development strategies. Towards that, J&K’s education sector requires very focused attention. We need an education system that is able to bridge the rapidly-growing gap between education and industry requirements, promoting a better match between skills and available jobs. Importantly, the many redundancies in J&K’s education system, like its rigid pedagogy rooted in an out-dated system of learning, needs review and correction.

The quantum of investment in infrastructure development, such as transportation, energy, etc, which can stimulate economic growth and create job opportunities in construction and related sectors, is not good enough for the current demographic realities in Jammu & Kashmir. While tourism and agriculture-horticulture sectors are doing largely well, the challenge is that the tourism sector’s trickle-down effect is limited. The retail sector is now largely a subsistence livelihood activity in J&K. While general trading is flourishing, but, again, this sector is not a large job creator. While public sector jobs are now being de-prioritised in J&K, the question is how sustainable is that in the long run? The government will have to think out of the box now and take effective policy measures to address unemployment.