The concept of jobless growth refers to a situation where economic growth does not lead to job creation. This phenomenon can occur when a country emerges from a recession, and despite an expanding economy, unemployment remains the same or worsens.
In India, jobless growth has become a significant problem. Even though India is one of the world's fastest-growing economies, with a projected growth rate of 6.9% in the current year, unemployment is currently at a three-month high of 7.8%.
Experts attribute India's jobless growth to several factors. For instance, much of the country's economic growth is driven by finance, real estate, and IT sectors, which are not major job creators. Additionally, India's education and training system has been criticized for not equipping graduates with the skills employers require. Less than half of college graduates in India have the skills that companies need, exacerbating jobless growth.
To tackle this issue, one solution could be to retrain workers and equip them with the necessary skills required for the future economy.
In contrast, the US is experiencing the opposite problem, where its economy is barely growing, but the unemployment rate is at its lowest since 1969. However, economists believe that the rising interest rates in the US are starting to slow down hiring activity.