Development and educated Unemployed in South Asia

Upgrading skills did not result in solving the educated unemployment problem in India and Sri Lanka. South Asian economies or particularly those sectors of economies that employ educated people, did not expand much. There was also a mismatch between the qualities of labour force demanded by the market and those that were supplied by the systems of education and training. Before the nineties, the public sector usually absorbed most of the educated people in South Asia but in the nineties, this situation changed. Instead of employing new graduates, reducing the size of the public sector employment was the policy. The withdrawal of the public sector from the labour market did not result in a large expansion in the private sector, as was expected. The expectation that the retreat of the public sector from the job market would be filled by job creating activities of the private sector and civil society did not materialize. There is also a kind of ‘waiting’ nature of unemployment or ‘voluntary unemployment’ in South Asia. Young people extend their unemployment and do not accept available jobs if they cannot find jobs that match their expectations. They remain dependent on their parents or extended family. (Asian Development Bank) In an interesting survey of the educated unemployment it has been observed that the rate of unemployment is lower for the highly educated than that for the less educated. This is indeed observed in the case of advanced countries such as US and Japan. The observation agrees with the theory that education contributes to the betterment of productivity and reduction of unemployment. Under these circumstances it may be recommended that one must get as much education as possible to decrease the risk of unemployment. The explanation for this may be found in the fact that higher the level of development higher is the demand for higher skill job in relation to the supply and hence lower is the level of unemployment among highly educated youth. Above relationship is reversed in the case of many developing economies such as India and Philippines. In these economies unemployment of the highly educated is serious. In India the unemployment rate at the university level was 17.6% for males and 24.9% among the females. At the upper secondary level the unemployment rate was 9.8% for males and 15.4% among the females. It was still lower at the lower secondary/middle level at 4.0% for males and 5.2% among the females. In Thailand the unemployment rate is the highest at vocational and technical level. In developing economies the explanation for higher unemployment among highly educated youth may be found in the fact that lower the level of development lower is the demand for higher skill job in relation to the supply and hence higher is the level of unemployment among highly educated youth. This may, however, appear too simplistic an explanation. Unemployment among educated should be understood in sectoral terms. In India the unemployment rate is higher for graduates who major in Arts, Science and Commerce subjects. Unemployment rate is low for those who majored in technology, medical and professional subjects. In spite of this it is disheartening to note that there is high percentage of students in former subjects. The fact that graduating from upper secondary schools does not help individuals find a job is one of the important factors responsible for discontinuing the studies at the senior secondary level. Alongside an increasing unemployment among highly educated youth there is also an extension of average job waiting period and overqualified persons, in turn, join jobs, which actually require lower qualifications. It has become common to find university graduates working in jobs suited for secondary school graduates. This fact is also a strong dismotivating factor to continue studies. Thus school graduates tend to be left out for reasons not related to examination system, incapacity to excel or poverty but due to broader institutional factors that cause unemployment among educated youth. The recent developments instead of mitigating the problems of unemployment among educated youth have, in fact, aggravated the problem of unemployment as well as the problem of left outs. The South Asian countries, as a whole, suffer from this problem. The recent study on Human Development in South Asia 2003 notes that in case of Sri Lanka, for instance, for the year 1999 in contrast to an unemployment rate of 1.9 percent among those with primary education, those with secondary and pre-secondary education and higher secondary school education registered an unemployment rate of 8.2 and 17.9 per cent respectively. Other countries in the region show similar findings. In case of urban India, in 1997, it was found that those with higher secondary education, 41 per cent were unemployed. In general, unemployment rates among the educated (secondary and above) were higher in urban than in rural areas. Below primary level of education the unemployment rate was merely 3.9 percent. Employment prospects of the educated youth have worsened during the past decade or so because of low or negative growth in public sector employment that was the major employer of educated youth. Whatever employment had occurred within the private sector was mostly in the semi-skilled or low skilled areas. Thus, very little employment was generated for the educated. (Human Development in South Asia, 2003, p.26). The important aspect of the failure to have job is that this led the educated youth towards inactivity. Data on Pakistan and India reflect these tendencies. For instance according to 1998-99 Labour Force Survey of Pakistan, 20 per cent of the post-graduate degree holders were out of labour force, who were neither working nor looking for work. Almost 50 per cent of female doctors and 35 per cent of graduates in different disciplines were reported to be out of the labour force. In case of India, the study cited above provides evidence on with drawl of educated youth from labour force. To conclude, an important point that emerges from the above may be noted. A simple perspective of upgrading skill is not the only solution for the problem of the left out youth, as they may remain unemployed even after upgrading the skill. The up gradation of skill must match the quantity and the quality of the labour force demanded in the market. Secondly, what can be done to the policy shift relating to the withdrawal of the public sector from the labour market or to the unemployment resulting from the open economy de-industrialization? This begs a much larger question of shift in developmental strategy and the structure of the growth process that impinges upon the problem of the left out youths from the demand side.

User comments

There are no comments

 Printable version