Do you know that maintaining employment growth at 2 per cent for a country like India is not an easy thing? Why?
Maintaining employment growth at 2 per cent for India is challenging because historically, GDP growth has been higher than employment growth. During the period 1950-2010, while GDP grew positively, employment grew at a rate of not more than 2 per cent.
There has been a widening gap between GDP and employment growth, especially since the late 1990s. This phenomenon, where the economy produces more goods and services without generating adequate employment, is known as jobless growth.
Additionally, India is an agrarian nation with a major section of the population living in rural areas and dependent on agriculture as their main livelihood. This structural composition makes generating sustained employment growth particularly difficult.
Explanation
The textbook context clearly explains that during 1950-2010, employment grew at not more than 2% while GDP growth was higher. The late 1990s saw employment growth declining and a widening gap between GDP and employment growth. The context introduces the concept of 'jobless growth' - producing more goods and services without generating employment. India's agrarian structure with large rural population dependent on agriculture adds to the challenge of maintaining employment growth.