Dear young people, it is no doom; just prepare for this jobs transition

21 April 2024

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The following is the recorded version of the lecture delivered by the author at Institute of Management and Public Administration (IMPA) Srinagar on 18 April, 2024.

Ladies and gentlemen, it is a privilege to talk to you today. It is particularly exciting because of the rich insights you bring to this hall for your close engagement and interaction with young people in your colleges and universities. Today, I am supposed to talk about what entrepreneurship, employment and skill development for youth in Jammu and Kashmir means in this era of artificial intelligence and ‘great churning’, and I look forward to hearing your valuable thoughts and insights on this subject in the process of this talk.

Ladies and gentlemen, this world today is at a watershed moment. There are multiple and profound reasons why this is a global watershed moment. Today’s complex economic and social realities might present a picture of doom and gloom with regard to economic opportunities for our younger generations, I will tell you, based on my global work experience and extensive travels and interactions, this is not a situation of doom and gloom. This watershed moment presents significant economic opportunities for our young people. The only pre-condition is how our youngsters would prepare for, upskill themselves and leverage the new opportunities that are unfolding in multiple economic arenas today.

Let me come back to why this is a watershed moment in the world’s economic and social evolution.

Firstly, it has something to do with the global demography. The world population is largely ageing and youth population is bulging. The proportion of young population as compared to elderly population is increasing rapidly across countries. So most of the countries, including India, are experiencing a youth bulge wherein anywhere between 40% to 66% of countries’ populations, including India’s population, is in the range of 18 and 35 years, which is significant. This huge youth bulge requires job and economic opportunities at a scale never before experienced on planet earth.

Secondly, introduction of new technology today, mainly artificial intelligence, robotics, machine learning and so on are making a lot of traditional jobs redundant. This ‘great churning’ is fundamentally altering the labor market, which is changing the means of production and how companies would engage people for production and services purposes. All this is changing the labour market in a very radical manner.

Thirdly, there is a huge cost of living crisis going on across the world today which is impacting every sphere of human endeavor, including job prospects. Although this crisis, in a good case scenario, may be a short term one, but for now, the cost of living crisis is real. And this crisis is shrinking disposable incomes and investments in almost every part of the globe. But, as I said, this may be short lived and while it is impacting us negatively today, this situation could change for the better as soon as the global supply chain comes back to normal.

Fourthly, we are also witnessing a time when natural resources are dwindling at a huge pace. This dwindling of Natural Resources is translating into an intense competition for economic resources and jobs across the world. I see this competition first hand almost on a weekly basis in country after country where I travel. There are multiple manifestations of this competition which I cannot elaborate due to time limitations. But the point is that this situation is creating a feeling of squeeze as well as an environment of innovation and race for new ideas. Everyone of us can join this race if we have the right education and skills.

This is the overall global context. Now let us shift to our country and Jammu & Kashmir’s situation.

Last month, “India Employment Report 2024: Youth Education, Employment and Skills”, produced by the Institute for Human Development (IHD) and ILO was released. This is a very significant report because it has produced data on employment and general labour market in J&K in a way we haven’t seen in recent years.

The India Employment Report 2024 examines the challenge of youth employment in the context of the emerging economic, labour market, educational, and skills scenarios in India and changes over the past two decades and is primarily based on analysis of data from the National Sample Surveys and the Periodic Labour Force Surveys.

Now let us take a look at J&K-related key data in this report.

In 2023, Jammu and Kashmir’s total population is estimated to be 1.56 crore. Considering the decadal growth of 29.98% and a high birth rate and a low death rate, Jammu & Kashmir’s population is bound to increase by about 40% in the next two decades. This growth is huge and offers both challenges and opportunities- challenges in terms of greater competition for resources, opportunities in terms of new market demand and new production, trade and services.

Now let us see what this population bulge would mean for employment and opportunities here. Jammu and Kashmir has a total government employee number of 4.5 lakh in 2023. And then we have the private sector. According to this ILO report, Jammu and Kashmir has a total employable work force or the labor force of 15 years plus of around 99.77 lakhs. However, out of the total population, only 40.88% constitutes the labor force.

Out of this labor force the male labor force is 70% while as the female workforce is only 9%, which means that there is a huge disparity in the labor force between males and females.

Now let’s talk about entrepreneurship. There are 5 or 6 key areas in the areas of core business and entrepreneurship in Jammu and Kashmir where meaningful and sustainable jobs are created. Here we need a little bit of clarification on what entrepreneurship actually means. In Jammu and Kashmir quite often we misunderstand and mistake normal business activities and startup activities with entrepreneurship. Entrepreneurship has a specific definition which actually means a business approach or a method wherein people leverage new and innovative business ideas in any particular sector by harnessing the gap between demand and supply. So, in other words, what entrepreneurs do is that they leverage and exploit the gap between demand and supply in any economic sector by introducing new and innovative ideas.

There have been several business and entrepreneurship ventures in J&K that have been succcessful, that have created business models of scale and have created good job opportunities. Several governmental schemes which provide excellent incentives have given a boost to a large number of business ventures, especially in tourism, industriss and value-added horticulture. We also see some new businesses struggle.

The fact of the matter is that as population increases and governments have to prioritise productive investment against unproductive government jobs, the proportion of government jobs to the labour force in J&K would continue to dwindle. Governments of limited means cannot provide jobs to everyone. Similarly, allmof our labour force cannot get jobs with their existing skill sets. As per the ILO report, 62.93% of Jammu and Kashmir’s employable population have no skills. That means 62.41 lakh persons in the age group of 15 plus have no skills for today’s job market in J&K. This is a big issue!

Even as there are multiple governmental schemes for skill development, those schemes have to be tailored to today’s job market realities.

All this comes in the backdrop of Artificial Intelligence, robotics and machine learning, which are eating away many traditional jobs and vocations. That means we would need to basically change the paradigm of skill development and Jammu & Kashmir.

Now let us take a look at the most latest data on educated youth unemployment, especially those in the age group of 15 to 29, in J&K.

In 2005 Jammu and Kashmir’s total unemployment rate was 21.8%. And this has grown to 34.81% in 2022. And again, there is a huge disparity between male and female unemployment. The total male unemployment rate in 2022 in Jammu and Kashmir is 25.8% while as the female unemployment rate is 57.4%, which is huge. This puts Jammu and Kashmir at 20th ranked across the country in terms of unemployment.

There is something more which is also very significant – that is the number of our youth who are not in any education or employment or training. And this, as per the ILO report, is 27.4% of the total youth population in J&K.

In this category of youth, males constitute only 11% while females constitute a staggering 44%.

This again is a significant disparity between the two genders.

Now let us look at the ILO report’s other aspect with regard to migration. The ILO report says that as of 2022, 38.3% youth population migrate for employment opportunities outside J&K.

In 2005, Jammu and Kashmir’s national ranking in terms of employment conditions was 4. But now this has come down to position 8 in 2022.

Now let us talk about workforce participation in Jammu and Kashmir. According to the ILO report, the total workforce participation rate in J&K was only 43% in 2022, which puts Jammu and Kashmir at rank 18 among all states and union territories in the country. And out of this workforce 70% are males while only 15% are females, which means two things – one that workforce participation in Jammu and Kashmir out of the total population is currently low, and, two, participation of females in overall workforce is really small. And that puts Jammu and Kashmir in the 20th rank among all the states of the country.

Summing up

To sum up, in this whole situation, there is no need for hopelessness. Whatbwe see in this data is that labour particiaption in J&K’s economic system is still low and there is a room for expanding this participation. As we saw in this data, women’s enhanced particpation needs particular attention. What is very important is that youngsters and parents take decisions very carefully in this transition. I believe that every parent and everyone who aspires to enter into a job market must study the global State of the Jobs report. This annual report gives us very significant insights into the kind of jobs that are going to vanish in the next 5 to 10 years and the jobs that would be freshly created. It also extensively talks about the skills that will be required in the job market of the coming years.

There are so many new kinds of jobs that are going to be created in the next five to ten years, especially in green energy, information technology, artificial intelligence, data analytics and agriculture sectors. Our youngsters must pay attention to those opportunities.

For more details on which jobs are likely to vanish in next 10 years and which new jobs will be created it would be good to take a look at this global State of Jobs report.

So, let’s don’t see this great churning as a doomsday situation. The good news is as that the population boom, new technology and energy transition are definitely going to create more economic opportunities. The only thing is that we need to get our youth ready for this transition. To begin with, we must realise that this change is inevitable. India is at the cusp of a major economic boom due to its demographic dividend and the economic opportunities its socio economic growth offers. In J&K we must get prepared to reap the dividends of this positive transformation.

Thank you.

The writer is an international development specialist and founder of Ziraat Times