Tepid Job Growth Amid 7% GDP Growth: Rajan

New Delhi: With seven per cent economic growth, India is not creating enough jobs as reflected by the number of applicants for vacant posts in some States, Reserve Bank’s former Governor Raghuram Rajan said and suggested the government needs to focus on promoting labour-intensive industries to generate employment. Rajan further said some Indians, especially those at upper level, are comfortable and have high incomes, but consumption growth from the lower half of the country has still not recovered to pre-pandemic level.

“That is the unfortunate part...You would think with 7 per cent growth, we would be creating a lot of jobs. But if you look at our manufacturing growth, it is more capital intensive,” he told.

Rajan was asked whether the Indian economy, which is growing at 7 per cent, is creating enough jobs. According to him, the industries that are more capital-intensive are growing faster, but labour-intensive industries are not growing. “It is not going well at the lower level. I think the desperate need is for jobs. And you can see this, forget the official statistics,” he said.