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Indian Economic Policy

Notes Strategy of Employment Generation in the Ninth Plan
The basic problem, which keeps people in a state of poverty, is the poor quality of employment in
terms of inadequate level of income for workers. The educational level of the workers reveals that 70
per cent of the workforce is either illiterate or educated below the primary level. In industries other
than agriculture, where skill development for higher productivity necessitates a reasonable level of
educational standard, 52 per cent of workforce was below the primary level of education, 26 per cent
being illiterate. (Refer table 2). The Ninth Plan, therefore, as a part of its strategy intended to focus on
the growth of sectors which have high employment absorption capacity of a relatively less educated
labour force. It mentioned, “The focus on agriculture, trade and transport and construction reflect
this imperative.”
It is really a sad commentary on our planning process that even after five decades of planned
development, nearly 84 per cent of the workforce engaged in agriculture is either illiterate or with an
educational level below primary. It is, therefore, vitally necessary that education and skill development
programmes which are essential features of empowerment be strengthened.

Table 2 : Percentage Distribution of Labour Force by Level of General Education (1993-94)

Illiterate Literate Middle Total Share in
upto and workforce
primary above

Agriculture 60.8 22.8 16.4 100.0 56.6
Other than
Agriculture 25.8 26.0 48.2 100.0 43.4
All industries 45.6 24.2 30.2 100.0 100.0

Note : Ususal status principal and subsidiary workers
th
Source : Compiled from NSS 50 Round Data on Employment and Unemployment.
As a part of enlarging employment and increasing the quality of employment, the Ninth Plan
emphasized, “It is necessary to increase public investment in agriculture especially for strengthening
irrigation and other rural infrastructure in backward areas so that sustained agricultural growth,
and, therefore, acceleration of employment growth is facilitated.” Besides this, the Ninth Plan intended
to emphasise horticulture - an employment intensive sector.
The Ninth Plan underlined the fact that Rural Non-farm Sector has increased its share of productive
employment from about 15 % in 1978 to 22 % in 1987-88 and further to 23 % in 1993-94. This sector
has registered an employment growth rate of 5 per cent between 1987-88 and 1993-94, which is very
heartening. This trend should be strengthened. This necessitates a decentralized pattern of
industrialisation so that rural areas can undertake small business and manufacturing on an increasing
scale.
An Assessment of the Employment Strategy

However, it may be mentioned that the Ninth Plan does not make employment as a central objective
of the policy, though it speaks of generating it as a corollary of the growth process. The Macro
Dimensions of the plan are couched in the traditional paradigm of saving, investment, GDP growth
rates. In this connection, it would be relevant to heed the advice given by the Human Development
Report (1996) which states that a clear political commitment to full employment is the essential
condition for development. The Report mentions : “Where employment creation has been most
successful, it has been the result of a deliberate strategy. Rather than assuming that employment
would materialise automatically, political leaders have identified it as a central policy objective.” It
further emphasises : “Employment needs to be restored to its place among the top policy concerns of

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