Racing to the bottom

Employment, or the lack of it, has been a frontpage issue long before Budget FY25 revealed the government's grudging and belated recognition of the problem.

- KANIKA DATTA

Economists (openly) and private sector chiefs (privately) agree that the three employment-linked incentive schemes and an internship programme outlined in the Budget are unlikely to be game-changers. As the Big Idea in this year's budget exercise, however, it reflects the pressure that is increasingly being imposed on the private sector to do the heavy lifting on the employment front.

Meanwhile, joblessness and the inadequate creation of good quality jobs are accelerating a race to the bottom with communities once considered quite prosperous clamouring for the backward class label to squeeze themselves into the reckoning for public sector jobs.

These twin trends have been gaining momentum since the disastrous demonetisation of 2016.

Ironically, they are likely to weaken the dynamics of job creation even further.

Let's consider the private sector.

Murmurs of extending caste-based affirmative action on the same lines as the public sector have been heard in the public domain since the early years of the 21st century.

Rahul Gandhi vaguely mentioned it recently. Because it's such a bad idea, no one took it (or him) seriously until the Andhra Pradesh Assembly sent a wake-up call in 2019 by passing a law reserving three-fourths of jobs in the private sector for local candidates earning up to 30,000 a month. That law has been in limbo after the Andhra Pradesh High Court suggested it "may be unconstitutional".