AGEING
WORKFORCE – ECONOMY
News:
Young Indians, Aging
Workforce
What's
in the news?
●
An analysis of India’s workforce, sourced
from Centre for Monitoring Indian Economy (CMIE) Economic Outlook data reveals
that despite having the largest youthful population, the workforce is
undergoing a significant aging process.
Young
Indians, Aging Workforce:
1.
Increase in Youth Population:
●
The segment of the population categorized
as youth increased in size from 35.49 crore in 2016-17 to 38.13 crore in
2022-23.
2.
Decline in Young Workforce:
●
In 2016-17, there were 10.34 crore people
under the age of 30 years in the workforce. By the end of 2022-23, this number
had fallen by over 3 crores to just 7.1 crore.
Highlights
from the CMIE Survey:
1.
Decrease in Young Age Workforce:
●
The share of India’s youth has fallen from
25% in 2016-17 to just 17% at the end of the last financial year in March.
2.
Decrease in Middle Age Population:
●
The share of those in the middle age group
has fallen from 38% to 33% over the same period.
3.
Increase in Ageing Population:
●
The oldest age category has grown its
share from 37% to 49% with the portion of those aged 45 and above rising from
around one-third to nearly half.
●
The increase of 60+ population in a
50-year time span, i.e from 2011 to 2061, is expected to be more than 320
million.
Challenges
with Aging Workforce:
1.
Lack of Elderly Care Structure:
●
India currently lacks a comprehensive
infrastructure for elderly care and a viable social support system for senior
citizens.
2.
Huge burden on state exchequer:
●
A significant portion of state
governments’ revenues is consumed by pension expenses.
●
Only one-third of the elderly in India
receive some sort of pension.
●
In Gujarat, the pension bill was 159
percent of the expenditure on salary and wages.
3.
Quick Pace of Ageing:
●
The older population is projected to take
only 20 years in India to double.
●
It took 110 years and 80 years to double
its share in France and Sweden respectively.
4.
Poor Social Security Coverage:
●
90% of the workforce in India is in the
informal sector, which has poor social protection for older persons, compounded
by their relatively low savings.
5.
Increased Poverty among the Aged:
●
A 2012 study by the United Nations
Population Fund shows that poverty rates are higher among older persons, with a
large proportion of them being economically fully dependent (52%) and partially
dependent (18%) on others for livelihood.
●
9.3 million individuals aged 61 and older
availed work benefits under the Mahatma Gandhi National Rural Employment
Guarantee Act (MGNREGA) scheme in 2019-20.
6.
Poor Access to Health Services:
●
India’s expenditure on health as a
proportion of GDP was only 0.95%, compared to 3% in China and 8.5% in the US.
It’s lower than the average for low-and-middle income countries (2.8%) and
Sub-Saharan Africa (1.9%).
●
The number of doctors per 10,000 people
was only 7.8 in India compared to 17.9 in China and 81.9 in Cuba.
7.
Tokenistic Government Schemes:
●
Numerous programs targeting the elderly
exist, but they tend to be symbolic and lack the necessary depth and financial
backing.
WAY
FORWARD:
1.
Differentiated Approach for Planning:
●
The percentage of the overall population
occupied by older individuals varies across different states. It’s lower in the
north-central states and higher in the southern states.
●
This emphasizes the necessity for
tailoring distinct strategies for planning based on the specific circumstances
of each state.
2.
Increased Spending on Human Development:
●
Investment will be particularly helpful
for states such as Bihar, Uttar Pradesh, Rajasthan, Madhya Pradesh and
Chhattisgarh, which have a growing young population but lag in human
development.
3.
Increasing the Retirement Age:
●
Progressively increase the retirement age,
helping governments in keeping the pension system solvent.
4.
ASHA for Elderly:
●
A network of caregivers and facilities
dedicated to elder care needs to be established. This would involve engaging
unemployed working- age adults in providing services to the elderly
5.
Reaping the Benefits of the Silver Economy:
●
Companies need to develop a more holistic
approach to address the needs of older workers and ensure that they are able to
continue working and contributing to the economy.
6.
Promoting Inclusivity:
●
Issues such as ageism and discrimination
need to be addressed and greater inclusion and diversity in the workplace needs
to be promoted.
7.
Re-employment:
●
India needs to harvest the financial
potentials the elderly hold and empower them at the same time, through
re-employment or employment in alternative roles.
●
For example, Japan introduced a voluntary
re-employment system for retirees who can join back the workforce as part-time
employees with different work hours and wages.