Economic growth – employment linkages in India

Economic growth is an important indicator of economic development of the country, and consequently its standard of living. Employment is very closely associated with the economic growth. The Classical as well as Keynesian theories of the Employment describe positive growth- employment relationship. That is with the rapid and higher economic growth the higher and rapid employment, and vice versa. Its empirical analysis has a special importance. Whether, the same relationship between economic growth and employment is observed in the context of a particular economy, or otherwise. Economic reforms being implemented in India since 1991 has a special importance on economic growth ground. It is because, it is stated that the economic growth of India has been speeded up significantly and comprehensively. It is during the economic reforms period only, India has crossed the 5% rate of growth during the beginning of the implementation of the economic planning, and has succeeded in achieving growth rate up to 10% and more that that also for some times. This poses the urgent need for examining the reality about the economic growth – employment linkages in India especially in the post reforms period. More importantly, what are trends in the linkages and what is their nature? This will enable us in assessing the growth – employment association ships suggested by the Classical and Keynesian employment theories, or the linkages between growth and employment are different than that of the theories of the employment. It is against this over all background, the present research papers endeavours to examine the linkages between the economic growth and employment especially in the post economic reforms period. But it will also attempt for identifying the growth – employment linkages in the pre reforms period also so that the comparison between growth- employment linkages between pre and post linkages can be made, which can have policy implications. The present paper is organized as; I) Introduction, II) Review of Research Studies, III) Objectives of the Study, IV) Hypothesis of the Study, V) Research Methodology, VI) Trends in Economic Growth of India, VII) Growth and Pattern of Employment in India, VIII) Economic Growth – Employment Linkages in India, IX) Major Conclusions and Policy Suggestions, X) Concluding Remarks, XI) References. The study concludes that economic growth achieved by the Indian economy is a jobless growth in both the pre as well as post economic reforms periods. Its economic growth was considerable in the pre reforms period than the post reforms period. Sectoral employment has a different scenario for the pre and post reforms period. The linkages between economic growth and employment show that growth in employment was very much lesser in the pre as well as post reforms period. It is mainly contributed by the secondary sector and service sector, but speeded up by the secondary sector and primary sector.