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8/8/2019 Employment policies India
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EMPLOYMENT
POLICIES OF INDIA
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INDEX
SR NO.
PARTICULARS PAGE
NO.
1 National Employment
policy-Introduction
2 Objectives
3 Basic Considerations
4 Policy Statements
5 Macro Economic Policies
6 Sectoral Policies
7 Labour Market Policies
8 Micro and Small
Enterprise
Development Policies9 Skill Development
Policies
10 Women Workers
11 Vulnerable Workers
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Vi l h h 3004
Ki j l Vora-3007
i ita Shah-3014
Gri h a Pat l-3015
Vi it Shah-3016
A hilash Pillai-3017
Sh tal Seth-3018
Mihir Shah-3019
Ki jal Patel-3020shan Sankhe-3021
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Programme would need to continue. T ere is indeed scope for suc
programmes to create productive employment rat er t an remain as fall -
back options, wit proper planning of works, tec nical support and
convergence of rural infrastructure works w erever feasible.
. T e role of State governments is critical in creating a facilitatingenvironment for accelerating t e growt of quality employment and
implementing t e policy in all its aspects.
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POLICY STATEMENTS
A multi-pronged strategy is necessary for ac ieving t e objectives of t e
national employment policy. Since t e basic objective is to create more
productive, sustainable and decent employment opportunities, economic growt
itself as to be more employment-intensive. T is would require not only t at
t e pattern of growt is oriented towards ig employment generating sectors,
but also t at in eac sector and subsector, policy instruments t at
tend to favor more employment-intensive product pattern and
tec nologies, are devised. At t e same time, policies t at are likely to inder
expansion of employment and encourage insecure and exploitative conditions of
work need to be reviewed and c anged.
Also, measures need to be adopted to improve employability of labor force in
t e dynamically c anging economic landscape. T e social dimensions of
employment in terms of special needs and treatment of women and
disadvantaged groups as to be an underlying consideration in all aspects of
employment policy.
Policy statements in t is document are accordingly arranged under t e
following seven major eads:
(i) Macro-economic Policies
(ii) Sectoral Policies
(iii) Labour Market Policies
(iv) Micro and Small Enterprise Development Policies
(v) Skill Development Policies
(vi) Women Workers
(vii) Vulnerable Workers
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TRADE POLICY
1. It is noted t at employment is considered as an objective of trade policy.
Mec anisms need to be devised to effectively relate various policy instrumentsto employment outcomes.
. Export incentives suc as duty draw back and tax exemptions/
concessions s ould be directly linked wit employment.
. Duty and incentive structure of imports and exports s ould be
reviewed to remove any features t at discourage employment
generation and revised to become more employment-friendly. For example,
any instances of inverted duty structure, w ic tend to be counterproductive to
employment generation, need to be removed.
. Concessions given to units in Special Economic Zones (SEZs),
s ould also be linked wit employment, eit er as an over riding or additional
criterion.
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SEC AL L C ES
IDEN IFICA ION OF SEC ORS
As noted earlier, itis essentialthat sectors and sub-sectors withhi h
employment potential are identi ied and besides getting priority in growth
strategy, sector-speci ic policies need to be evolved fortheir faster growth and
greater employment orientation.
While this exercise needs to be carried outin detail atthe sub-sectoral
level, sectors that can easily be identified for specialtreatment from
employment viewpoint are agriculture, manufacturing, construction, 8retail
trade, tourism and information and communication technologies (IC .
Recent experience has demonstrated that some of these sectors have
considerable potential for faster employment growth while others needstrengthening of their growth process to improve quality of employment.
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A sub-sectoral approac to policy-making is necessary to improve
employment intensity of manufacturing. Labour -intensive industries (e.g.
textile products, leat er products, beverages, food products and wood products)
need to be given special policy support and incentives to grow faster, including
for sale in external markets.W ile dereservation may be necessary and desirable in t e present
context, t e small scale sector needs to be compensated by adequate policy
support in ot er sp eres (e.g. Credit, marketing) in order to sustain its
growt and perform its important role in employment generation.
Labour-intensive sectors, particularly t e micro and small
enterprises, need to be provided strong tec nology and skill support t roug a
package of extension services and training worked out to particularly suit t eir
requirements.
Special package of support s ould be developed for small, multi-product
clusters in backward areas particularly utilizing t e forward and backward
linkages t at could be locally realized .
CONSTRUCTION
T e construction sector as registered ig employment growt as wellas ig employment elasticity. W ile t ese features of t is sector are
likely to continue, poor quality of employment is a matter of serious concern.Implementation of various provisions of labour regulation , minimum wages,
safety and welfare, need to be strictly implemented. T e government effortsneed to be supplemented by t ose from t e trade unions and civil societytowards t is end.
Efforts s ould be made to explore alternative to t e contractorsystem for recruitment. Strengt ening of t e existing labour marketinformation system is necessary for t is purpose.
A special programme for development of skills to meet t e
requirements of c anging tec nology in t e construction sector needs to bedeveloped. A few public and private sector initiatives already on ground couldbe emulated on an expanded scale for t is purpose.
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RETAIL TRADE
T e Trade sector as experienced one of t e fastest growt s
in employment over t e past decade; and is likely to sustain t is growt in
coming years. T e need particularly seems to be of improving quality of
employment, especially in retail trade.
For t e very small, self-employed retail traders, like t e street s ops and
vendors, policies need to guarantee t eir rig ts to space and
liveli ood. Implementation of National Policy for Hawkers, Street Vendors
and small s opkeepers s ould receive urgent attention.
T e question of FDI in retail trade s ould be considered only after careful
examination of its impact on business of small traders and employment.
A national regulatory mec anism may be constituted to ensure
fairness of competition and sustenance of small traders and vendors, as well as
to ensure good conditions of work in t e retail stores.
TOURISM
Tourism industry as grown rapidly and so as employment in t is sector.
Inadequate infrastructure and s ortage of skilled workforce are identified as
major constraints in furt er acceleration of its growt . T e Elevent Plan
as made several suggestions to reduce t ese constraints, by adoptingdestination and circuit focused planning of infrastructure and public
private partners ip (PPP) in creating training facilities, w ic need to be
expediously implemented.
Tourism projects t at integrate local socio-economic development,
t roug forward and backward linkages, s ould be especially
encouraged. A package of incentives, fiscal, financial and ot ers s ould
be developed for t is purpose.
Capacity for training tourism personnel at different levels needs to bevastly expanded. Special emp asis s ould be given to build training
capabilities at local level t roug w at may be called a Capacity
Building for Service Providers (CBSP) programmed.
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OTHERS
C aracteristics and experiences of ot er sectors and sub -sectors (e.g. IT
and ITE Services) need to be analyzed and policy measures t at would elp in
improving t e growt and quality of employment in t eir respective sp ere,
need to be identified.
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LABOUR MARKET POLICIES
Labour market policies aim at either regulating employmentto ensure
safety, fairness and equity at work; or at promoting employment
either by directly creating work or facilitating employment creation by
providing information, training and placement services.
LABOUR REGULATION
Labour regulation in India is seen, on the one hand, as providing
excessive protection, to a small segment of workforce in the
organi ed sector, and, on the other, leaving the overwhelming
majority ofthose in the unorgani ed sector, completely unprotected, either
because of the non-applicability of regulatory provisions, or because of
ineffective implementation of provisions that apply to them. The
regulatory regime in respect of labour requires to be closely examinedwith a view to devising ways to minimi e this dualism.
Part ofthe reason forineffectiveness and non-compliance oflabour
regulations and frictions and disharmony arising out ofthem lies in the
confusion created by multiplicity oflaws, definitions of concepts and categories
and administrativejurisdictions. Labourlaws need to 12 be codified,
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definition, scope and coverage harmoni ed and administrative spheres are
clearly demarcated.
Such of the provisions of laws that render adjustment of workforce
inflexible, and thus adversely affect efficiency of production, on the one hand,
and the employers willingness to employ more workers, on the other, need to
be modified, with due regard to the reasonable compensation to the affected
workers.
While compliance of the provisions of social security, where such
provisions exist, must be ensured by improving the efficiency ofthe existing
mechanisms or adopting alternative ones, a minimum measure of social
security must be available on a statutory basis to the hitherto unprotected
workers.
ACTIVE LABOUR MARKET POLICIES
Special employment programmes have been in operation for severaldecades now. Their effectiveness has varied. Those of self-
employment variety have helped most ofthose assisted to increase their
incomes and some to cross the poverty line. Wage-employment programmes
have met part ofthe employment gap and supplemented participants income to
a certain extent. Allthe ongoing programmes need to be critically reviewed
with a view not only to improving their effectiveness butto see ifthey could be
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replaced by just one-or two programmes wit clear objectives and effective
implementation.
Introduction of NRE P, as t e single and statutorily backed wage-
employment programme in all rural a reas of t e country as been a welcome
and important step as a purposeful and focused active labour market policy.W ile its contribution to provide supplementary employment, as a rig t,
and, t erefore, an assured income to rural ouse olds is beyond any doubt,
ways need to be found to utilize it for creating conditions for sustainable
employment and all round rural development. Improving capabilities of local
democratic institutions and suitable c anges in administrative and financial
procedures would be necessary to establis effective and purposeful linkages
between t e sectoral programmes/projects and NRE P, for t is purpose.
SKILL DEVELOPMENT
Organizing a system of training for development of skills required for
securing suitable employment is anot er important component of t e active
labour market policy. rowing mismatc between supply and demand of
skills and inability of t e existing skill development system to meet t e
demands of a dynamically c anging labour market as been frequently
ig lig ted. Nature and magnitude of t e problem and recommendations
for its possible solution ave been given in a subsequent Section.
LABOUR MARKET INFORMATION
In a situation of rapidly c anging production structure and
tec nology, particularly in t e wake of globalization, t e nature and
composition of demand for labour is also c anging dynamically, even in a
single location, industry and enterprise. Labour market information
service assumes special importance in t is context. At present, Labour
Market Information Service is provided by Employment Exc anges,
w ic play t e very limited role of registering job seekers andnotifying candidates to prospective employers. T ese agencies need to be
restructured to be able to provide complete information on job market,
vocational guidance and active elp in placement.
Employment exc anges instead of being passive recipients and
suppliers on demand of t e information provided by clients, s ould play
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State governments will be encouraged to come up wit policy
responses on micro and small enterprises and strengt en t e state level
departments and agencies and to exc ange experiences for learning from eac
ot er, wit special focus on ome based workers, t e majority of w ic
are women.
A compre ensive review of t e functioning of t e District Industries
Centres (DIC) will be taken up wit a view to strengt en t eir capacity and
orient t em more as Counseling Centres, resource and convergence
centres, and one-stop s ops for micro and small enterprises t roug
preparation of projects, skill development, periodic disaggregated data
collection and dissemination of information.
ORGANISATION OF INDUSTRY AND WORKERS
Recognising t e role of MSE associations in policy formulation,
advocacy, dissemination of information, steps will be taken to form suc
associations in places wit out suc associations and strengt en t eir capacity
of t e existing ones.
Recognising t at workers organisations in t e MSE sector are few and
need strengt ening, it will be t e endeavor of t e Government to encourage
formation of workers organizations t at will en ance t eir ability to secure
basic conditions of work (e.g. toilets, drinking water, eating facilities),
minimum wages, social protection, voice and representation, social
mobilization/awareness generation, skill training and access to ousing.
T e formation of Workers Facilitation Centres for suc purposes as
registration and servicing of social security will be encouraged.
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SKILL DEVELOPMENT
Recognizing t e enormous deficit in basic education and formally
acquired skills by t e working people, skill development will be recognized as
an important component of active labour market policies of t e
government.
MATCHING TRAINING WITH DEMAND
Labour market information systems will be set up adequately to
annually assess t e labour market requirements, identify labour -
intensive ig -growt sectors, so t at skills development can be
planned and delivered accordingly to meet t e demands.
T e focus on skill training and development will fall on t e informal orunorganized sector of t e workforce. Appropriate programmes and sc emes
will be developed (some are already underway, suc as t e Skills Development
Initiative) and introduced t roug out t e country to meet t e requirements of
suc workers.
Recognizing t e inadequacy of institutional capacity in t e
public sector in training of trainers, policies and programmes will be
introduced for t e participation of t e private sector as well as t e non-profit
sector suc as cooperatives, NGOs and p ilant rop ic institutions.
To encourage acquisition of formal skill training by socially
disadvantaged groups (e.g. SCs/STs) special packages will be
introduced to provide sc olars ips, ostel facilities and tool kits.
STANDARDS AND CERTIFICATION
T e employability of trainees must be made t e main focus of all
future training efforts, including components suc as curriculum
development, training delivery, certification etc.
A system of independent certification for candidates passing t roug skill
training as well as trainers will be instituted wit appropriate 18standards.
T is will be done at t e national and state levels by designating
competent institutions in public, private and non-profit sectors. A system of
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accreditation along t e lines adopted by t e University Grants
Commission (in respect of institutions of ig er education) will be
introduced.
Greater involvement of industry in various initiatives mentioned above is
crucial. To ensure greater involvement and interaction, existing and successfulmodels will be assessed and t eir replication wit appropriate
adaptations will be taken up. Linkage wit Education System and ot er
programmes
From a long term point of view, skill training as to come t roug
vocational education. Given t e limited capacity of existing
institutions, government will en ance t e seating capacity (in public, private
and non-profit sectors) by creating new institutions and offering
vocational education as an option at t e ig sc ool level of Class.
Special focus will be given to rural areas and to yout from
disadvantaged social groups.
Given t e fact t at a majority of t e workforce as an educational level
of less t an years (including illiterates), functional literacy programmes
will be strengt ened and extended. T is will be done on t e basis of a review of
t e ac ievements of t e National Literacy Mission as well as t e literacy
campaigns carried out by civil society organizations.
Skill training and development will be made an important component of
public programmes and sc emes especially t ose focused on a large number of
beneficiaries suc as t e National Rural EmploymentGuarantee
Programme, National Rural Healt Mission, Sarva S iks a A b iyan, ICDS
and Mid-Day Meal Programme. T is will give considerable advantage to
women in rural areas as t ese activities are mostly, if not only, suited to t em
and predominantly spread over t e villages in t e country .
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IDENTIFYING SECTORS
Sectors w ere womens participation is significant will be identified for
specific focus as, for example, in agriculture, food processing, fis ing,
plantations, forestry, orticulture, export intensive manufacturing, tourism
and care services wit a view to introduce tec nology t at are drudgery
reducing and/or labour augmenting t ereby creating conditions for
employment generation, a decent work and ig er productivity.
Policies and programmes for skill training and development for
women will ave a specific component of entrepreneurs ip
development for women- eaded micro and small enterprises.
FACILITATING STRUCTURES
Special institutional mec anisms will be created to cater to womens
employment, suc as information centres and organizational structures.
To promote decent employment in emerging sectors and activities.
Special facilities (in t e form of committees) will be establis ed in
clusters and large enterprises to ensure t at basic conditions of work wit
dignity are provided for women workers and t at no discriminatory
practices are allowed. T ese relate to (i) sanitary, drinking water,
eating and c ild care facil ities, (ii) ensure t e payment of minimum wages
w erever applicable, (iii) enforcement of safety standards and (iv)
representation of women in collective bodies of workers.
A specific area in w ic women ave responded in large numbers arising
out of economic compulsions is t eir ig level of participation in t e National
Rural Employment Guarantee Programme (NREGP). It will also be t e
Endeavour of t e government to ensure t at wage payments are carried out in a
timely and transparent manner and create suc systems (like Post Office or
Bank Savings Accounts) t at will bot ensure timely and full payment and
empower t em in t e long run in dealing wit modern financial institutions.
Special attention will be given to t e educational and skill training
requirements of women workers t ereby addressing, inter alia, t e
perceived bias against women workers in t e labour market
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ORGANISATION AND EMPOWERMENT
Given t e greater deficit in organization and representation of women
workers, especially in t e informal economy, special programmes and enabling
conditions will be created for organizing informal women workers and
strengt ening t eir collective capacity.
T e Self Help Groups of women ave emerged as an innovative form of
organization for accessing credit, marketing as well as ot er services.
W ile encouraging t e spread of t is organizational form to areas w ere it is
currently eit er absent or low presence, policies will be put in place to ensure
t at micro credit graduates from consumption smoot ening to liveli ood credit
t at will ave a focus on t e creation of productive employment wit backward -
forward linkages.
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VULNERABLE WORKERS
In an economy where an overwhelming proportion of workers are in the
informal sector whose defining characteristics is low productivity,
small si e of enterprises and absence of job and/or social security to
workers, vulnerability should be reckoned as all pervasive. However, there are
specific segments of workers who are at a distinct disadvantage arising out of
theirhelpless nests in terms oflocal distress, distress induced migrants, working
children, workers with physical challenges orthose in bondage like conditions.
MIGRANT WORKERS
Effective enforcement ofthe Inter-State Migrants Act of19xx will beensured to regulate the recruitment as well as terms and conditions of work.
The state governments will ensure that migrant workers have access to
basic amenities such as shelter, drinking water and sanitation, health care
and access to schooling forthe children. In addition, it will also ensure,
through appropriate legislation that the social security scheme for workers
in the unorgani ed sector are also made available to the migrant workers.
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CHILD LABOUR
STATE DISTRICTS SANCTIONED
SCHOOLS
COVERAGE
CHILDREN
ACTUAL
SCHOOLS
COVERAGE
CHILDREN
AndhraPradesh
20 807 43550 610 36249
Bihar 08 174 12200 173 10094
Gujarat 02 040 2000 023 1254
Karnataka 03 100 5000 024 1200
MadhyaPradesh
05 138 9800 087 6524
Maharashtra 02 074 3700 024 1200
Orissa 16 430 33000 239 14972Rajasthan 02 060 3000 054 2700
Tamil Nadu 08 379 19500 307 14684
UttarPradesh
04 150 11500 105 7488
WestBengal
04 219 12000 164 8250
Total 76 2571 155250 1810 104615
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STATE-WISE PROJECTS UNDER IPEC AND NUMBER OF CHILDREN
COVERED (92-97)
Tackling c ild labour (w ic is declining) calls for policies and
programmes to improve t e liveli ood security of poor families to w ic t ey
belong. Provision of gainful employment especially during lean
seasons, better enforcement of minimum wages of adult workers,
STATE PROJECTS
APPROVED
NO. OF
CHILDREN
AndhraPradesh
15 15455
Bihar 3 1340
Delhi 6 4200
Gujarat 5 1350
Haryana 1 300
Karnataka 2 1320Kerala 2 2000
MadhyaPradesh
6 2050
Manipur 1 500
Maharashtra 7 1750
Orissa 4 1500
Rajasthan 7 5800
Tamil Nadu 17 6710
UttarPradesh
11 13939
WestBengal
19 22890
Regional 2 NA
All India
Institutions
11 NA
Total 120 81154
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provision of basic social security and contingent social security will be
strengt ened. In addition, c ild-centered programmes suc as ICDS and Mid-
Day Meals in sc ools will be extended to cover t e w ole country and
steps taken to en ance t eir effectiveness.
An area requiring special focus is to strengt en access to sc ooling
especially in rural areas. T e augmented programme of Sarva
S iks a A b iyan is expected to ensure universal enrolment of
c ildren in sc ools. Special sc emes will be introduced to states t at account for
an overw elming proportion of c ildren out of sc ool.
State governments and local self governments will be encouraged and
incentivized to ensure provision of quality education. T e family -
centric and convergence-based c ild labour approac will be promoted t roug
policy and sc emes, particularly at t e district levels. Special sc emes will beintroduced for states t at account for an overw elming proportion of c ildren
out of sc ool. Regionally focused policies and programmes will t erefore get
special attention.
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World Banksees NREGA as a barrier toeconomic
development
NEW DELHI: T e World Bank as described t e muc -acclaimed National
Rural Employment Guarantee (NREGA) sc eme of t e UPA government as a
policy
barrier urting economic development and poverty alleviation.
Various sc emes of t e Indian government like NREGA, waters ed programmes
and sc emes for development of small and medium towns are acting as "policy barriers to internal mobility", t e bank said in its 'World Development Report'
.
T e internal mobility, t e report argued, is necessary as "lifting people out of
poverty requires s ifting populations from villages to cities". T e process of
migration s ould be encouraged, t e bank said.
"Negative attitudes eld by (t e) government and ignorance of t e benefits of
population mobility ave caused migration to be overlooked as a force ineconomic development," it said.
T e report said economic benefits of migration are not always recognised by
policy makers and, in fact, two forms of policy ave been attempted in India to
counter migration.
"T e first response as been to increase rural employment, in an attempt to stem
movement out of rural areas ... T ese measures include t e recently introduced
National Rural EmploymentGuarantee Programme," it said.
T e World Bank cited ot er programmes suc as waters ed development to
improve agricultural productivity and development of small and medium towns,
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w ic t e Indian government as taken up to reduce migration.
"T e second policy response is implicit. Because of t e perceived negative
effects, local governments remain ostile toward migrants, w ile employers
routinely disregard laws to protect t eir rig ts and needs," t e report said.
In many cases, welfare policies and social services are designed for a sedentary
population, t e bank
"T is is best exemplified by location-specific entitlements to social services,
ousing subsidies, food rations, and ot er public amenities especially important
to working poor people," it said.
T e report, w ic recommends concentration of production an d mobility of people, said, "Current policies do not allow communities to fully capture t e
benefits of labour mobility."
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Under t e sc eme, anyone willing to avail t e benefits as to register wit t e
local gram panc ayat, w ic in turn issues a job card. If employment is not
provided wit in 15 days of receipt of t e job card, t e applicant is entitled to an
unemployment allowance.
T e sc eme, initially started in 00 districts in February 006, was later
expanded to 130 more districts t is year.
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IMPLEMENTATION AND MONITORING
National Employment Policy is to be implemented by different
ministries, bodies and agencies of t e government, bot at t e Centre and in
t e states. It is, t erefore, essential t at an institutional mec anism is
developed to ensure t at employment is mainstreamed in growt strategies,
macro-economic and sectoral policies and to monitor results of policy
initiatives. Implementation of employment policy involves several stages.
To begin wit increasing t e employment-intensity of economic growt
requires identification of sectors t at are more employment -friendly and
pursue policies and programmes conducive to t eir growt . Identification of
suc sectors and sub-sectors could be based on an analysis of t e
employment impact of growt of suc sectors. It will need to be ensured t at all
major projects and t eir associated investment decisions take into
consideration t e employment aspect. Assessments need to be made of t e
extent of benefits derived from capital subsidies of various kinds and
alternative types of labour subsidies (for instance subsidies promoting
employment intensive tec nologies) need to be evaluated.
In order to oversee and carry out suc assessments t ere must be an
institutional mec anism establis ed, t at is suitably empowered.
Adequate uman and financial resources s ould be dedicated to
carrying out suc exercises wit in t e budgetary allocation. Periodic
monitoring and evaluation, as relevant, needs to be done on a regular basis.
For undertaking t e tasks of assessment and monitoring effectively, it is
necessary to identify t e nature and details of t e required data and arrange
t eir collection and collation at regular intervals. It appears t at for
carrying out a meaningful Employment Audits t e present data collection
systems need to be muc improved.
Specifically,
A system of Employment Impact Assessment needs to be developed
and made a pre-condition of all major macro economic policy initiatives.
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A c eck list s ould be provided to different ministries and
macroeconomic policy-making institutions to ensure t at basic
employment issues are taken into consideration.
A suitably empowered institutional mec anism needs to be
constituted to oversee employment outcomes of macro economic and sectoralpolicies.
Data systems and monitoring mec anisms need to be
created/improved-it may, for example, be necessary to ave annual rounds
of t e ouse old NSSO Employment and Unemployment surveys, and to
improve coverage of employment in data collected and collated by
organizations like t e ASI and DGET.
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