As the focus shifts to government formation and the priorities of the new dispensation in Bihar, it may be good if the incoming government could implement the suggestions that the NITI Aayog had recently offered to create more service sector jobs in the eastern state.
Bihar has a strong services sector orientation, with it figuring in a limited list of states and Union Territories (which also includes Delhi, Chandigarh, Karnataka, Kerala, Telangana, and Maharashtra) where the average share of services exceeds 55% of GSVA, as per the NITI Aayog. The services sector in Bihar, though, is primarily low-end.
In its report titled “India’s Services Sector: Insights from Employment Trends and State Level Dynamics”, released in October 2025, the NITI Aayog had pointed out that although employment in the services sector had increased to 22.2% (~10.2 million workers) in Bihar in 2023- 24, the figure was still much lower than the national average of 29.7%.
As per the NITI Aayog, the wholesale and retail trade had the highest employment share (46.9%) in the services sector in Bihar in 2023-24. Transportation and storage (16.4%) and Education (11.3%) were the other sectors with high employment share.
Other sub-sectors within the services sector which had a reasonably high employment share was “Accommodation & food” (4.4%). Employment share in the “Professional & scientific” arena was just 0.6%.
What are NITI Aayog's Recommendations?
The NITI Aayog had suggested a multi-pronged approach to raise the level of service sector employment in Bihar. For rural areas, NITI Aayog had proposed expanding opportunities in public administration and financial services. For urban areas, the suggestion was to “prioritise ICT, real estate and professional services, especially in areas like Patna and Gaya”.
The NITI Aayog had further proposed the promotion of digital inclusion by connecting informal workers, especially women, to skill development, job platforms, and social benefits through mobile accessible portals. It was also suggested that these workers be provided “access to portable digital welfare IDs to maintain continuity of social security benefits across the state”.
Additionally, the NITI Aayog had recommended scaling community-based service models such as rural logistics, telecom repair, etc., for the purpose of generating more employment in the state.
Implementing the NITI Aayog’s prescriptions has strong justifications.
Potential for Rural and Urban Job Growth
For all the talk about manufacturing sector jobs, there is no escaping the reality that too many large industries may not immediately be making a beeline for Bihar. The other aspect regarding large industries is that big investments, while good for the growth of a state’s economy, do not automatically translate into the creation of a huge number of jobs.
Moreover, much as the youth of Bihar would crave for ‘government jobs’, there is no hiding from the fact that it would always be a challenge for any government to meet this aspiration.
Apart from needing low investments compared to manufacturing, the services sector is a low-hanging fruit from the standpoint of employment generation, as it can absorb even low-skilled and medium-skilled workers. The areas identified within the service sector by the NITI Aayog, where job creation holds maximum possibilities in Bihar, mirror the economic realities of the state and what is easily doable.
Need for Formal Service Sector Jobs
Considering the possibilities that the services sector offers, it would, thus, be ideal if the next Bihar Chief Minister could immediately establish a panel to work out the roadmap for implementing the suggestions put forward by the NITI Aayog on service sector employment generation. Such an exercise should be completed within the first 100 days of the new government, and the rollout should happen immediately thereafter.
In all this, though, the aim should be to create more formal jobs in the services sector and not just add to the number of gig workers.
For many decades now, young, aspirational people of Bihar have been forced to look outside their home state for decent employment opportunities. It is time this scenario is reversed, and the new government addressing the jobs challenge with the seriousness it deserves would be the expectation.
Politically significant Bihar must demonstrate that it can rise economically, too, as a Viksit Bharat (developed India) needs all its states to prosper.
(Sumali Moitra is a current affairs commentator. X: @sumalimoitra.)
Views are personal and do not represent the stand of this publication.
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