Unemployment is the gravest economic challenge India faces today.
No one knows that better than BJP Rajya Sabha member, Bhupender Yadav, whose appointment as the Minister for Labour and Employment comes at a time when the pandemic has hit the working class severely, particularly those in the informal workforce.
Virtually all the major economic policies are aimed to tackle this problem.
Job creation is vital to kick off the cycle of demand creation and consumption, which had stagnated due to the economic slowdown, jolted by two big consecutive shocks – or waves - of the pandemic.
Yadav succeeds senior BJP leader and eight-time member of Lok Sabha, Santosh Gangwar, who was holding Independent Charge as Minister of State.
Yadav will be steering the Ministry of Labour and Employment not just through implementation of the four Labour Codes but will also address unemployment concerns plaguing the large number of job seekers, as well as build a safety net for migrant labour through social security schemes.
In addition, he would also have to ensure that the proposed Labour Codes enhance ease of doing business for the industry and employers.
Here's a look at the challenges ahead of him.
Implementation of the Labour Codes
The Parliament passed three Labour Codes in the Monsoon session of 2020 amid massive criticism and protests.
These are the Industrial Relations Code, the Code on Social Security and the Occupational Safety, Health and Working Conditions Code.
Along with the Code on Wages passed in August 2019, the four Codes merge 44 pre-existing labour laws.
The Codes, which were meant to streamline and simplify overlapping labour laws, fall under the Concurrent List of the Constitution. They were set to be rolled out on April 1, 2021, but are yet to see the light of day.
Implementation of the four Labour Codes has been deferred primarily because of the delays by state governments in finalising rules.
So far, only Uttar Pradesh, Punjab, Madhya Pradesh, Uttarakhand, and Jammu & Kashmir have published draft rules for the codes.
About 21 states, including big ones such as Maharashtra, West Bengal, Andhra Pradesh, and Tamil Nadu, have not notified the draft rules as yet.
Analysts have noted that as the health emergency took centerstage, finalizing the draft rules for Codes have got sidelined.
The incoming Labour Minister is tasked with the responsibility to collaborate with the states and ensure that the Codes be implemented at the earliest.
Unemployment/Job losses
The unemployment rate in India had been on the rise even before the pandemic, when the economy had slowed down. But a bad situation became worse at the time of the national lockdown in 2020.
India is said to be the worst-impacted country due to the COVID-19 pandemic.
As per the Centre for Monitoring Indian Economy (CMIE), some 121 million jobs were lost in India in April 2020, the highest ever monthly job loss on record since the private think tank started compiling employment data.
Out of the 121 million jobs lost, some 91 million were daily wage labourers and workers in the unorganised sector, CMIE had estimated.
In April 2020, the unemployment rate touched a record high of 23.52 percent, dropped to 21.73 percent in May 2020 and 10.18 percent in June 2020, it said.
Although the unemployment rate had started improving from October last year, it climbed to double digits yet again after the second wave of COVID-19 hit India.
During May 2021 when the second wave ravaged the country, over 15 million jobs were lost, the CMIE said in a report.
As a result of mass layoffs and job losses, millions in India have been pushed into poverty.
Welfare of migrant and informal workers
The COVID-19 pandemic seriously exposed the vulnerabilities of migrant workers, who are present in low-paid and low-skilled jobs and have limited access to social protection.
With the entire economic machinery coming to a standstill, the migrant workers were forced to return to their hometowns.
Given this background, the Labour Standing Committee of the Parliament had recommended that the Centre put in place a credible database of unorganised workers, especially migrant labourers, to ensure seamless delivery of relief packages to them at the time of distress.
In light of the recommendations made by the parliamentary committee, the Labour Bureau, an attached office of the Ministry of Labour and Employment, is conducting the five All India Surveys on labour.
In March 2021, the government had flagged off the field on two of the five All India Surveys, which included the All India Surveys on Migrant Workers.
However, due to the severe nature of the second wave of the pandemic and its penetration into rural areas, the surveys were suspended.
In order to bring informal workers under the social security net, the government passed the Code on Social Security, 2020, which for the very first time extends social security benefits like maternity leave, disability insurance, gratuity, health insurance and old age protection to workers in the country’s booming unorganized sector.
These include gig workers, platform workers, contract workers, freelancers, and home-based workers. It also stipulates the gratuity benefits to fixed-term employees without any conditions on minimum service.
The Code, however, is yet to be implemented.
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