In what ways Employment can be increased in Urban Areas?

Urban and metropolitan regions are the centres of our country’s economy. These bustling hubs lure from rural areas and neighbouring countries in search of better employment and entrepreneurial opportunities. However, conversely, this is a cycle that results in increased unemployment: as more people settle in urban areas, there is a greater need for employment opportunities, which in turn causes a significant number of unemployed people. As such, it is a pressing need to explore ways to boost employment in urban areas. This article will explore the same.

 What is the current scenario of Employment in Urban Areas in India?

First, let us look at the current scenario of unemployment and labour force participation in India, as per figures reported b  Centre for Monitoring Indian Economy (CMIE).

Metric	Status
Urban Unemployment Rate	7.5%
Rural Unemployment Rate	5.2%
Labour Force Participation Rate for Women in Metropolitan Areas	17.5%
Labour Force Participation Rate for Men in Metropolitan Areas	52.5%
Percentage of Urban Employees in the Informal Sector	Almost 90%
Top 3 Cities with Highest Unemployment Rate	Delhi (16.7%), Mumbai (12.1%), Chennai (11.6%)

Urban unemployment hit a record high of 24.4% in April 2020 as a result of the COVID-19 pandemic, which had a significant impact on employment. While employment grew gradually, youth unemployment in urban areas was still 20.8% in December 2021, and 16.5% for those living in rural areas.

How can employment in urban areas be boosted?

There are a variety of strategies that may be employed by the government in order to increase employment and achieve equitable labour force participation in urban areas. These are:

Encouragement of Entrepreneurship 

By offering tools and incentives like training programs, incubators, and financial opportunities, and encouraging and supporting those who are interested in beginning their own enterprises, the government can positively impact job creation, thereby reducing unemployment.

Access to Credit

Ensuring that startups, MSMEs (Micro, Small, and Medium Enterprises) have readily available lines of credit at low-interest rates creates an environment that is suitable for business growth. It will ensure that a diverse group of people, companies and organizations are able to gather capital and funding for their products and services, thus boosting the economy and creating employment opportunities.

Education and Skills Training

By ensuring that people have access to high-quality education and skill-training programmes that will provide them the information and abilities needed to land high-quality work opportunities, the government can ensure that people are able to move from positions requiring menial labour to skilled positions. This will decrease the dependence on factory labour, seasonal employers and the unorganized sector.

Infrastructure Development

In order to draw businesses and generate employment prospects in metropolitan areas, it is important to invest in the development of infrastructure including roads, transit, communication networks, and public facilities. This will create new jobs, temporarily by creating increased demand for labour, and in the longer run by improving the overall development and economy of the region.

Industry Clusters

By encouraging and assisting in the creation of industry clusters, such as technology parks, industrial parks, and business incubators, companies will be encouraged to group together in clusters to increase efficiency, cut costs, and generate employment. This can serve as a powerful tool of city planning, which can help in developing the economy of under-served areas by incentivizing the establishment of industrial groups.

Public-Private Partnerships (PPPs)

Public-Private Partnerships can be an excellent tool to unite the public and private sectors in order to cooperate on initiatives that contribute to the economic development of metropolitan areas.

Tourism

Boosting the tourism industry by developing and promoting the local cultural and heritage sites, monuments, facilities, and businesses is a surefire way to increase employment in a variety of sectors, such as transportation, hospitality, entertainment and food/beverage industries.

To conclude, as the rural migration to urban areas creates pressure on the local workforce, it is the need of the hour for the government to collaborate effectively with the private sector in order to boost employment opportunities. In order to do this, innovative solutions are required, such as boosting tourism, facilitating public-private partnerships, funding and supporting startups, developing infrastructure, providing vocational training, etc.

Frequently Asked Questions

Q 1. How may the private sector help increase jobs in urban areas?

Answer – The private sector may significantly improve job prospects in metropolitan areas by investing in sectors like manufacturing, services, and construction, fostering skill development and training, providing better working conditions, and supporting regional economic growth.

Q 2. Discuss one case in which the government was able to boost urban employment.

Answer – The Pradhan Mantri Employment Generation Programme (PMEGP), introduced by the Ministry of Micro, Small and Medium Enterprises (MSME) in 2008, is one instance of how the Indian government is boosting urban employment. The PMEGP is a credit-linked subsidy programme that offers start-ups and established micro and small businesses financial support in the form of a subsidy on the project cost with an emphasis on creating jobs for underrepresented groups in society. By 2021, the programme had employed more than 5 million individuals nationwide, creating work chances for those living in metropolitan areas.

Q 3. What steps can be taken to formalise the informal economy in cities so that it can provide jobs?

Answer – The informal sector can be formalised in urban areas by offering registration and licencing services, promoting access to credit and financial services, providing training and skill development programs, and encouraging the adoption of formal labour laws and regulations.

Q 4. What role does technology play in creating job opportunities in cities?

Answer – The establishment of new businesses and industries, as well as the promotion of skill development in cutting-edge sectors like robotics, artificial intelligence, and machine learning, can all be considerably aided by technology.

Q 5. What steps can be taken to promote gender equality and increase the number of women working in cities?

Answer – One way to improve gender equality and increase women’s participation in the labour market in metropolitan areas is to implement policies that encourage equal pay and non-discrimination, provide maternity benefits, and promote flexible work schedules.