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LISTEN TO THE PEOPLE , NOT THE NUMBERS

Relevance:

• GS3 :
  • Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment.
  • Inclusive Growth and issues arising from it.
• GS2:
  • Issues Relating to Development and Management of Social Sector/Services relating to Health, Education, Human Resources.

 Why in the News ?

• The Indian economy is facing a significant challenge: incomes are not growing sufficiently or sustainably for a large number of people.
• Even though overall GDP growth is good, there is increasing pressure for reservations and jobs for all “economically weaker” sections regardless of caste or religion.

Source : Research Gate 

 Economists’ Debate

• Economists on both sides, for the government and those against it, are debating whether the economy is creating enough jobs and are questioning the veracity of the government’s data. 
• Those against the government also want to show that the problem of growth with insufficient jobs has been created by the policies of the present government and not the previous one.

 Data vs. Reality : The US Economy in Comparison

• The data is what they can see, but it cannot explain the problem, and will not point to the right solutions.
• The S. economy also seems to be doing well according to its headline economic numbers.
• Growth is good and employment numbers have been improving.
• Yet, polls show that a large majority of U.S. citizens are dissatisfied with the state of their economy.

The Workers’ Perspective

• S. statistics of growth and employment, whose veracity no one doubts, are not measuring what really matters to common citizens.

Critical Assessment:

• The discrepancy between U.S. economic statistics and citizens’ sentiments underscores the need to measure factors that truly matter to the common population, such as fair deals and income security amid inflation.

India’s Income Challenge

• The overall problem of incomes in India, according to economists, is that insufficient numbers have moved out of agriculture into manufacturing.
• This has been the historical pattern for sustainable growth in all countries, including the U.S. a hundred years ago, and China more recently.

The Short-Cut and its Cul-de-Sac

• Inadequate Transition:
  • The primary income issue in India stems from a lack of sufficient movement from agriculture to manufacturing, deviating from the historical growth pattern observed in other countries.

• Failed Shortcut in the ’90s: 
  • In the 1990s, policymakers in India attempted a shortcut, bypassing manufacturing and moving directly from agriculture to services.
  • Unfortunately, this shortcut has proven to be a dead-end or cul-de-sac.

• High-End Services Limitations: 
  • The transition to high-end services faces limitations in absorbing the substantial number of young job seekers in India.
  • Additionally, these service-oriented roles demand educational levels often absent in rural areas.

• Need for Skill-Compatible Jobs:
  • As individuals shift from agriculture, there is a requirement for jobs that align with their existing skills and provide a platform for skill development and upward mobility.

• Importance of First Step Jobs: 
  • Labour-intensive manufacturing, services, and construction sectors serve as the initial stepping stone for individuals moving out of agriculture.

• Shortcomings of Current Jobs:
  • Despite the transition, the jobs available, regardless of the sector, are deemed inadequate.
  • They lack sufficient pay, often being temporary or on short contracts.
  • Lack social security and support for skill enhancement.

• Role of Contract Employment: 
  • Large modern manufacturing enterprises often hire workers through contractors for flexibility, reducing costs. 
  • However, these contract workers receive lower pay, face job insecurity, and lack support for skill advancement.

The Prevalent Paradigm

• The world is at a turning point.
• New ideas of economics are required to create a more environmentally sustainable and socially harmonious future before it is too late.
• New concepts of “work” are required; also new designs of enterprises in which the work is done; as well as new evaluations of the social and economic relationships between participants in these enterprises.

The Shift Towards Green, Organic, and “Local”

• The drive for green, organic, and “local” to reduce carbon emissions and improve care of the environment will make small enterprises beautiful again.
• “Economies of scope” will determine the viability of enterprises rather than “economies of scale”.
• Denser, local, economic webs will develop, rather than long, global supply chains through which specialized products made on scale in different parts of the world are connecting producers with consumers in other distant parts.

The Economic Value in Caregiving

• Attention will shift towards creating genuine “social” enterprises, rather than enterprises for creating economic efficiencies and surpluses which corporate enterprises are designed for.
• Those who provide care, and their work of caregiving, must be valued more than economists value them today.

The Informal Economy (Women in Informal Economy)

• In the present paradigm of economic growth, caregivers, traditionally women, are plucked out of families – which are a natural social enterprise-to work in factories, offices, and retail, in enterprises designed to produce monetary economic value.
• When economists measure women’s participation in the labour force, they value only what women do in formal enterprises for money.
• They seem to assign no value to the “informal” work they do outside their homes to earn money, whether as domestic caregivers in others’ homes or on family farms. 
• Moreover, they are unable to see any economic value in the caregiving they provide without monetary compensation in their families and communities.

Listening to Marginalized Voices

• Policymaking should prioritize listening to marginalized voices—workers, small farmers, entrepreneurs, and women—whose perspectives are often overshadowed by economic experts, financial institutions, and large corporations.

A plea for policymakers to break away from relying solely on historical statistics and engage in people-centric policy making. Understanding the needs and values of the population, especially those traditionally undervalued, becomes paramount for shaping a more inclusive and sustainable economic future.

Source: https://www.thehindu.com/opinion/lead/listen-to-the-people-not-the-numbers/article67557562.ece/amp/

Mains Practice Question :

Critically examine the prevalent paradigm of economic theory and its impact on social organizations, particularly families. Discuss the need for a paradigm shift towards valuing caregiving and creating genuine “social” enterprises.