Employment : Job loss in 2 years

  • Indian Economy: Series of job losses witnessed by the economy in multiple sectors in the last 2 years.
  • There is hardly any growth in private investment, private consumption and exports.
  • The growth in economy is fuelled by government spending only.
Scenario in textile sector:
  • Exports and production is down due to slump in both external and domestic demand
  • Demonetization and transition to GST has hit small players
  • Labor issues and cost of production is also causing structural issues in the sector
  • Most of the units that have been shut in the sector belong to power loom textile
  • The government does not capture data from the small and medium scale textile sectors; hence the distress in these areas is not visible.
Important observations:
  • Capital goods firms are struggling as most of the downstream sectors are saddled with excess capacity and low demand.
  • Labour bureau’s Quarterly Employment Surveys (QES) are also showing downslide in employment growth because of the layoffs in IT/BPO and financial services sector, which were earlier the key drivers of growth in these surveys.
Textile Workers Rehabilitation Fund Scheme (TWRFS)
  • The scheme was introduced in the year 1986
  • Aim: to provide relief to workers rendered jobless due to permanent closure of non-SSI (Small Scale Industry) textile mills in private sector
  • Relief: workers who have suffered job loss are given wages for three years on tapering basis
  • This scheme has been merged under Rajiv Gandhi Shramik Kalyan Yojana in 2017
Rajiv Gandhi Shramik Kalyan Yojana (RGSKY)
  • Introduced in 2005
  • This is an unemployment benefit scheme when the unemployment is caused due to closure of a factory or permanent invalidity arising out of non-employment injury
  • The unemployment benefit is provided for the period of 12 months
  • This also covers medical care for the beneficiary and the beneficiary’s family

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