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India / A “demographic dividend” ?

ONE of India’s bigger private-sector employers can be found in Patna, the capital of Bihar, a poor, populous state in the east of the country. Narendra Kumar Singh, the boss, has three gold rings on his right hand and arms big enough to crush rocks. His firm, Frontline, has 86,000 people on its books. They are mostly unskilled men from rural areas in poor states like Bihar; thanks to Mr Singh they have jobs in cities all over India.

There is lots to celebrate about this. Mr Singh’s business has sales of $185m and its employee base has grown by 1,600% since 2000. He is looking for a Western partner and wants to expand to Sri Lanka and Bangladesh. He is providing paid work for part of the large cohort of young people now entering the workforce. And by shifting people from farms to cities he is helping urbanisation of the sort that underpinned startling progress elsewhere in Asia.

Yet Frontline is also a symptom of a colossal failure. For it is not supplying labour for a manufacturing boom of the kind that helped so many in China, South Korea and Taiwan out of poverty, or for the IT services at which India has excelled. Instead it offers relatively unproductive service-sector jobs—in particular, security guards. It has become de rigueur for every ATM, office, shop and apartment building to have guards. Across India millions of young men now sit all day on plastic seats in badly fitting uniforms with braids and epaulettes, unshaven and catatonically bored as the economic miracle passes by. This isn’t how East Asia got rich.

From a bomb to a boom and back

During the boom of the 1990s and 2000s, it became fashionable to talk of India’s forthcoming “demographic dividend”. This was quite a turnaround. In the 1960s and 1970s, the booming populations of states like Bihar were seen as a curse. “The Population Bomb”, a Malthusian bestseller by two American environmentalists, Paul and Anne Ehrlich, began by describing “one stinking hot night in Delhi”, and its horrifying number of “people, people, people, people”. In the 1970s there was a forced sterilisation programme.

Chosen excerpts by Job Market Monitor


via India’s demographic challenge: Wasting time | The Economist.

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