The Potential of combining Aadhaar and Periodic Labour Survey

Since about 45 years, the Ministry of Statistics and Programme Implementation under the Government of India has been conducting quinquennial Employment and Unemployment Surveys. These surveys are the primary data input to the government on labour force-related attributes, which in turn can guide the government in its employment-related decision-making.

India is the largest democracy and the second most populated country in the world. It also has the largest population of young citizens. The government of any democracy is duty-bound to enable realisation of the aspirations of its population. And the pressure on the government is considerable when a huge percentage of the population is under 25 years of age. By having access to sample-based employment and unemployment data no more frequently than once every five years, a government in inherently heavily disadvantaged in assuming its role as an effective generator of employment.

Given this scenario, and the frequency with which employment and unemployment related data is available, it is heartening to note that the present government is replacing the 45 year old quinquennial survey with a more-suitable-for-the-times Periodic Labour Force Survey. This survey will provide labour and employment data refreshes every quarter for urban India and annually for rural India. A quarterly refresh of labour and employment statistics will help observe key employment and labour force related trends at an unprecedented pace. Another very relevant dimension of this survey will be the inclusion of both formal and informal employment sectors.

The potential of Aadhaar

Aadhaar, the unique identifier for Indian residents, has the potential to be the most significant data unit in the government’s hands. A significant decision of the National Democratic Alliance is the mandatory linking of Aadhaar with Permanent Account Numbers (PAN). It is also to be linked with bank accounts. The government has also indicated that it may make Aadhaar mandatory for booking railway and air tickets, and for even boarding a commercial flight. Increasingly, government-provided benefits are being provided based on Aadhaar. The government is extending itself to make Aadhaar prevail over the entire population, and rightly so. A nation with limited resources and with a population the size of India cannot afford to channel its resources inefficiently. Aadhaar can control inefficiency and exploitation in provision of any subsidy the government provides. But Aadhaar’s potential extends far beyond clean and efficient provision of subsidies and other state-funded benefits such as midday means in schools.

Marrying Aadhaar data with Periodic Labour Survey Data

Over 90% of India’s population is believed to have the Aadhaar-based unique identity already. If Aadhaar databases could include individual attributes such as qualification-based skills, especially for India’s young and fairly young adults, it will provide the government a young population-wide profile of prevailing skill levels by domain. If skill-based Aadhaar data is married with the new labour and employment survey data, the combined dataset will give the government insights into:

• Rate of absorption of labour force by  industry
• Labour unemployment status by skill

The government already is aware of which industry requires which skills, and will have a vision for which industries it would like to grow in India.

With these inputs, the government may be able to drive the unemployed workforce towards industries hungry for their specific skills, and predict increase in employment and reduction in unemployment.

The government will also be in a position to suitably enable investment in education in skills where there is a shortage and the related industries are expected to grow. Where insufficient skills exist among workforce, the government can enable investment in education to complement existing skills to improve their employability.

Where skilled workforce is available and the relevant industries are still small in India (such as clean energy-related ones), the government can incentivise their growth for absorbing already skilled labour.

A quarterly refresh of employment and labour force data will aid the government in any course-correction and fine-tuning of its strategies towards education and employment generation.

NDA’s faith in technology

Undoubtedly technology leads to job losses, and widespread adoption of technology – which is inevitable in the coming decades with artificial intelligence and Internet of Things – will lead to greater job losses. However, targeted and sustained investment in technology can reduce not just general hardships faced by most Indians but also the more serious social problems India could face if its population of young unemployed people is allowed to bloat.

Realisation of temples of modern India notwithstanding, successive Indian governments have greatly under-invested in technologies that can improve the lives of ordinary Indians. It’s heartening to note the present government’s faith in science and technology in solving the country’s bigger problems. Over time the layer of technology infrastructure across India’s length and breadth must grow thicker and sturdier with one of the prime objectives of this investment being to address India’s bigger problems, and thus making living in India less hard for future generations. This is possible with Aadhaar as the backbone of this infrastructure.

Aadhaar may well be the brahmaastra the government can use to attack illiteracy and unemployment, besides social evils like corruption or disproportionate distribution of resources. It’s a relief to note that the Supreme Court recently turned down the submission made by a bunch of activists giving crazy arguments against Aadhaar. However, it would help a great deal to have an Opposition with interests aligned with those of the country as against those aligned compulsively against the government at the centre.