Employment potential in the services sector in India

Abstract

This chapter is an overview of the problem of employment potential in the services sector in India. It uses results of the NSSO survey of employment and unemployment for the years 1999–2000 and 2011–12 to make some preliminary projections of employment in services sector up to the year 2020. The focus is on employment growth of workers in the age group 15 to 59 years based on usual principal status. The estimated projections of employment indicate that annual additions to service sector employment falls in the range of 2.4 million to 4.2 million based on the assumption that services sector annual average output growth rate would be 9 per cent. This will make the share of the services sector in the total working-age labour force go up from 30 per cent in 2011–12 to 33 per cent in 2020. Analysis of more recent employment data for the year 2017–18 based on the PLFS surveys is found to be along the lines of findings based on the NSSO surveys. Services sector employment is shown to be relatively skill-demanding.