India's job crisis: Labour Ministry hits back at Citigroup; says report fails to consider data from official sources

India's labour ministry on Monday refuted Citi group's report which stated that New Delhi will struggle to create sufficient employment opportunities even with a 7 per cent growth rate, citing that it does not "analyse all official data sources available in the public domain".

The government 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 the Reserve Bank of India'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," the Centre said in a media release.


The Ministry of Labour and Employment emphasized 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.

Further, 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, it added.

The Ministry reiterated that the Government remains committed to creating a robust and inclusive job market.

Govt's counter
The Annual PLFS report shows an improving trend in key labour market indicators for individuals aged 15 and above from 2017-18 to 2022-23:

• Worker Population Ratio: Increased from 46.8% in 2017-18 to 56% in 2022-23.
• Labour Force Participation Rate: Rose from 49.8% in 2017-18 to 57.9% in 2022-23.
• Unemployment Rate: Declined from 6.0% in 2017-18 to 3.2% in 2022-23.

"This is a clear indicator of the positive impact of government policies on employment. Contrary to the report, which suggests a dire employment scenario, the official data reveals a more optimistic picture of the Indian job market," the ministry said in its defence.

The government said that EPFO is indicative of the rise in formal jobs. "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. Moreover, during last six and half years (since September, 2017 to March, 2024) more than 6.2 crore net subscribers have joined EPFO," it said.

Furthermore, the National Pension System (NPS) data, as per the ministry also reveals a positive trend, with over 7,75,000 new subscribers joining in 2023-24 under the Central and State governments, a 30 per cent increase from the 594,000 new subscribers in 2022-23.

Additionally, the Global Capability Centers (GCCs) and the gig economy are projected to significantly increase employment, the government said. It cited the NITI Aayog report on the gig economy which anticipates that platform workers will reach 23.5 million by 2029-30, forming 6.7 per cent of the non-agricultural workforce.