New Delhi [India], January 31 (ANI): The incorporation of artificial intelligence (AI) into India’s labour market will improve workforce quality, increase productivity, and generate jobs, said the Economic Survey tabled in the parliament on Friday.
The Economic Survey says, ” The integration of AI into India’s labour market presents an opportunity to enhance productivity, elevate workforce quality and create employment, provided systemic challenges are effectively addressed through robust institutional frameworks.”
The survey highlighted that the adoption of AI into the labour market will support economic growth. In addition, the survey said that integration will improve the labour market outcomes.
“For India, a services-driven economy with a youthful and adaptable workforce, the adoption of AI offers the potential to support economic growth and improve labour market outcomes,” the Economic Survey added.
The survey highlighted the need to prioritise education and skill development in the country to enhance the capabilities of the labour force.
“Prioritising education and skill development will be crucial to equipping workers with the competencies needed to thrive in an AI-augmented landscape. By capitalising on the global infancy of AI, India has the opportunity to prepare its labour force for a future defined by collaboration between human and machine intelligence,” it added.
The survey added that India’s labour market growth in recent years has been supported by post-pandemic recovery and increased formalisation.
As per the 2023-24 annual Periodic Labour Force Survey (PLFS) report, the unemployment rate for individuals aged 15 years and above has steadily declined from 6 per cent in 2017-18 to 3.2 per cent in 2023-24.
The labour force participation rate (LFPR) and the worker-to-population ratio (WPR) have also increased (Chart I.52). In Q2 FY25, the urban unemployment rate for people aged 15 years and above improved slightly to 6.4 per cent compared to 6.6 per cent in Q2 FY24. Both LFPR and WPR also increased during this period, the survey added.
The formal sector in India has seen significant growth, with net Employees’ Provident Fund Organisation (EPFO) subscriptions more than doubling from 61 lakh in FY19 to 131 lakh in FY24.
In April -November 2024, net additions reached 95.6 lakh, driven largely by youth. Workers aged 18-25 years contributed to 47 per cent of the net payroll additions. This indicates a growing trend towards formal employment, which enhances workers’ access to social security and stability. Government initiatives are playing a key role in enhancing the formalisation of the job market, the Economic Survey added. (ANI)
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