1. Changes in Sectoral Share of GDP 📊

• Over forty years, the percentage share of the three sectors in India’s GDP has shifted significantly. 📉➡️📈
• By 2013-14, the tertiary sector emerged as the largest contributor to GDP, replacing the primary sector. 🏥💼
• The shift indicates a move towards a service-based economy, reflecting growth in sectors like healthcare, education, and information technology. 🌍
• This change is driven by the expansion of the service sector with increased demand for professional services, financial services, and ICT-related businesses. 💻
• The industrial sector also experienced growth, but it didn’t create enough jobs to match the production increase, which contributed to employment imbalances. 🏭
• Globalization and the expansion of trade services have been crucial drivers in making the tertiary sector dominant in India’s economy. 🌐

2. Primary Sector’s Role in Employment 🌾

• Despite changes in GDP composition, the primary sector (mainly agriculture) remains the largest employer in India. 🧑‍🌾
• A significant portion of India’s workforce is still engaged in agriculture, which contributes only about one-sixth of the GDP. 🍞🌾
• Agriculture remains deeply embedded in rural areas, and rural livelihoods continue to depend heavily on farming, even though productivity per worker remains low. 🏡
• The disparity between agricultural employment and productivity highlights the issue of underemployment in the sector. 🔄
• Even as the importance of agriculture in GDP has declined, its role as a safety net for a large portion of the population remains unchanged. 🌱
• Small-scale farming and subsistence agriculture continue to dominate, which limits income and development opportunities for millions. 🌾🛖
• The lack of mechanization and low-level technological integration in agriculture prevent significant productivity improvements, leading to persistent low wages and job dissatisfaction. 🚜

3. Secondary and Tertiary Sectors’ Employment Growth 🏭📚

• While production in the secondary (industrial) and tertiary (service) sectors grew significantly, employment in these sectors did not increase proportionally. 🏢📈
• This suggests that industrial and service sectors did not create enough jobs relative to their output growth. ⚖️
• Automation and technological advancements in industry and services led to fewer jobs being created despite higher production levels. 🤖💻
• In the industrial sector, the increased use of machinery and technology reduced the need for human labor in many industries. 🏭🛠️
• Similarly, in the service sector, many businesses adopted digital platforms and online services, which required fewer employees to handle larger volumes of work. 📱🖥️
• As a result, despite a boom in production, these sectors contributed to fewer job opportunities than expected, creating a mismatch between growth in output and employment growth. 📉

4. Disparity Between GDP Growth and Employment 📈👷‍♂️

• The increase in production in both the secondary and tertiary sectors outpaced job creation.
  • For instance, industrial output increased nine times, but employment only grew three times. 🏭
  • Similarly, service sector production grew 14 times, while employment grew five times. 📚
• This imbalance reflects the unequal distribution of employment opportunities across sectors. 🏢
• The growth in capital-intensive industries and highly-skilled service jobs has not translated into widespread employment for low-skilled workers. 🏗️💼
• As a result, employment growth has been concentrated in sectors such as agriculture and informal service jobs, leading to a high reliance on low-wage work. 💸
• The lack of skilled labor and vocational training further limits the ability of workers to transition into growing sectors like manufacturing and technology. 🧑‍🏫👨‍💻

5. Underemployment in Agriculture 🚜

• Underemployment is widespread in agriculture, where more workers are employed than are necessary to maintain current levels of production. 🌾👨‍🌾
• Example: In Laxmi’s small farm, all five family members work, but they are not fully utilized. Their labor is divided inefficiently, leading to disguised unemployment. 🔄🌾
• Even if some workers leave for other employment, agricultural production would remain unaffected. 🚜
• Underemployment is often hidden and is not as visible as unemployment, making it harder to address through policy. 🔍
• The presence of multiple family members working on the same plot often leads to less efficient labor distribution, which affects overall farm productivity. 💪🌾
• As the number of workers exceeds the necessary amount, many end up working at a fraction of their capacity, further contributing to the inefficiency in agriculture. ⏳

6. Potential for Employment Shifts 💼

• Moving workers from agriculture to the secondary or tertiary sectors could increase overall productivity and household income. 🔄💼
• For example, if two workers from Laxmi’s farm moved to a factory or service job, the family income would increase, but agricultural output would not decrease. 🏭💸
• This indicates the underutilization of labor in the agricultural sector and the potential for a more productive distribution of labor. 🔄
• Employment diversification could improve living standards for rural families, while also reducing the dependency on agriculture as a sole source of income. 🌱🌍
• Job creation in urban areas and within the industrial and service sectors can help absorb the surplus workforce from agriculture, reducing rural poverty and providing better opportunities for economic growth. 🏙️💡
• Shifting labor from agriculture could also help reduce regional imbalances in employment, encouraging urbanization and development in emerging cities. 🌆

7. Hidden Underemployment in the Service Sector 💼

• Underemployment also exists in the service sector, especially in urban areas where casual and informal workers often face difficult working conditions. 🏙️🔧
• Casual workers, such as plumbers, painters, and street vendors, often face irregular work hours and low wages, making it difficult for them to fully support their families. 🚶‍♂️🛠️
• These workers often do not find work every day, even though they are actively seeking jobs, which limits their ability to earn a steady income. ⚒️💸
• The inconsistency of work, combined with low job security, contributes to economic instability for these workers and their families. ⚠️
• Many of these workers work in the informal economy, which lacks social security, making them vulnerable to economic shocks and health crises. 🔒
• Despite the growing demand for services, the lack of formal contracts or stable employment opportunities leaves many workers without proper social and economic safety nets. 🛑

8. Lack of Better Opportunities in Service Sector 🚶‍♀️💼

• Many workers in the service sector remain in their jobs because they have no alternative employment opportunities, often leading to a state of economic dependency. 🌍📉
• This hidden unemployment suggests that better job opportunities in the service sector are scarce, leading to underutilization of labor and limited wage growth for many workers. ⚖️💡
• Workers often take whatever work they can find, even though their skills and labor are not being fully utilized, leading to a mismatch between available jobs and their qualifications. 💼
• The absence of formal employment pathways and career growth prospects results in stagnant wages and limited upward mobility for service sector workers. 🏗️
• Underemployment in the service sector also reflects structural issues within the economy, where large segments of the population remain outside the formal workforce. 🔄
• A lack of investment in skill development or job training programs in the service sector further exacerbates these challenges. 🎓